The people of Minneapolis may soon be without the services of Uber and Lyft due to a dispute with the city’s government over if the ride-hailing companies will pay their drivers an effective $15.57 minimum wage. A local ordinance mandating that was supposed to go into effect May 1, but the city council has pushed that date back to July 1.
If it still goes into effect in its current form, the companies say they will pull out of the city.
In January 2023, members of the Minneapolis city council introduced a bill that would remove Uber and Lyft’s exemption from the city’s $15.57 per hour minimum wage. Legislation co-author Robin Wonsley said that the companies’ drivers, who are considered independent contractors instead of employees, were being exploited with low pay that didn’t cover their expenses.
“Multibillion dollar corporations will always see workers as expendable,” she said, according to the Minnesota Reformer. “Minneapolis council members are fighting back on behalf of our workers.”
There’s a possibility that Minnesota’s state government could pass a law overriding the Minneapolis ordinance. Texas’ state government did so after city councils in Austin and Houston mandated fingerprinting and background checks for drivers. In Minnesota, state lawmakers opened the door to reconfiguring the bill that Gov. Walz vetoed before commissioning a state study of the issue. The study suggested that a driver pay rate of $0.89 per mile and $0.49 per minute could net out to a $15.57 effective minimum wage. The city ordinance would impose $1.40 per mile and $0.51 per minute, plus a $5-per-trip minimum payment.
Another possibility is that the city council itself changes its approach. Council member Andrea Jenkins and a swing bloc of other members pushed the body to delay the measure Thursday, according to CBS. The Star Tribune reports that Jenkins has proposed a compromise rate of $1.21 per mile and $0.51 a minute. And Minnesota Public Radio reports that other council members are waiting to see if the state legislature takes action before July.