Feb 26, 2024 - News

Uber, Lyft warn they'll leave Minneapolis if new rideshare driver pay ordinance passes

An Uber logo written on the blacktop pavement of a parking lot with a motorcycle zooming past in the background.

Photo: Jakub Porzycki/NurPhoto via Getty Images

Uber and Lyft have renewed their threats to stop serving Minneapolis if the city council moves ahead with a proposed ordinance setting new pay requirements for rideshare drivers.

Why it matters: Even after negotiating through the winter, Uber, Lyft and driver advocates still don't agree how to address drivers' concerns about low pay.

  • How, or whether, they resolve the impasse will affect tens of thousands of Twin Cities drivers and passengers.

Driving the news: The council's latest proposal would require rideshare companies to pay drivers a minimum of $1.40 per mile and 51 cents per minute while transporting a passenger within city limits.

What they're saying: On Monday, Uber representative Josh Gold told Axios that would lead to "much higher prices for riders and less work and pay for drivers," and would force the company to leave Minneapolis.

  • If the ordinance passed, "Lyft would be forced to cease operations in Minneapolis and possibly the rest of the state," according to a company statement.
  • Gold added that Uber would prefer to work with state lawmakers on new rules covering all of Minnesota, not just Minneapolis.

Flashback: The city's new rideshare proposal comes really close to numbers floated last year in legislation at both the city and state level. Both of those proposals were vetoed in the wake of similar threats from Uber and Lyft.

The other side: Throughout that debate, driver advocates have maintained the companies were bluffing, trying to shirk their duty to pay workers fairly.

  • "Drivers told us that their wages are extremely low and unreliable, their vehicle and fuel costs are high, and their families struggle to make ends meet," city council members Jamal Osman, Robin Wonsley and Jason Chavez wrote earlier this month.

Of note: Mayor Jacob Frey has also urged the council not to act until state officials release results of their own study of rideshare driver pay data.

  • In a Feb. 16 email to the council, Frey said he was open to larger wage increases, "so long as … the companies and services do not leave the city entirely.

Zoom in: Uber and Lyft have previously proposed a $1.17 per mile, 34-cent-per-minute pay floor. A city analysis found both the council's and the companies' proposals would achieve the city's goal: guarantee rideshare drivers earn at least $15 per hour.

  • Yes, but: The analysis found the council's $1.40 per mile, 51-cent-per-minute would more fully compensate drivers for expenses like vehicle wear and tear.

What's next: The city council will hear public testimony on its proposal on Tuesday afternoon.

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