The Seattle City Council on Tuesday approved the minimum wage standard for Uber and Lyft drivers, becoming the second city in the country to do so.
Under the law, effective in January, ride-hailing companies would be required to pay approximately an equal amount after spending on the city’s $ 16 minimum hourly wage for businesses with more than 500 employees.
Mayor Jenny Durkan said in a statement, “The epidemic has exposed fault lines in our system of labor safety, causing many frontline workers such as those who work without safety nets.”
Seattle’s rule, passed in a 9 to 0 vote, is part of a wave of efforts by cities and states to regulate gig-economy transportation services. It is based on a measure that New York City passed in 2018. Last year, California effectively approved a law requiring Uber and Lyft to classify drivers rather than contractors independently, which would assure them safety like minimum wages, overtime pay, workers’ compensation and unemployment. Insurance. The companies are supporting an initiative on the November vote that would exempt their drivers from California law.
Uber and Lyft have received more favorable treatment from federal regulators. Last week, the Department of Labor proposed a rule that would likely classify its drivers as contractors, although it would not override state laws like California’s.
As in New York, Seattle law would create a formula for minimum compensation for each trip – a combination of per-minute and per-mile rates known as usage rates, or fractions of each. During the hour, drivers have a passenger in their car. The idea is that the low usage rate should correspond to a high per minute and per mile rate, so that drivers can be compensated for being less busy.
The intention of the formula is to produce an hourly wage just under $ 30 before expenses and motivate companies to reduce their drivers rather than flood the market with cars to reduce passenger wait.
Lyft’s spokesman, CJ Macklin, said, “The city’s plan is deeply flawed and will actually destroy jobs for thousands – more than 4,000 drivers on Lyft alone – and drive ride-share companies out of Seattle . “
Uber declined to comment, but said in a recent letter to Seattle City Council that New York’s policy had resulted in lower ridership and higher prices for passengers, and it allowed the company to reduce the number of drivers on the platform at once Was led to limit.
Michael Reich, a labor economist at the University of California, Berkeley, a New York measurer and advising Seattle on his new law, said the average driver salary had increased in New York and overall revenue had risen significantly. Declining demand due to rent.
The increase in ridership was slow after the policy was implemented, Mr. Reich said, but this was largely for unrelated reasons for the policy.
Beyond the pay standard, the Seattle measure stipulates that companies should hand over all tips to drivers, suggesting tips may not count toward the minimum and that companies should provide protective equipment to drivers or reimburse them for these costs .
A comprehensive program proposed by Ms. Durkan, Fair Share, was approved last fall. The agenda included a tax on 51 cents and a ride lift, part of which has helped fund a streetcar project downtown and provide assistance for drivers, including help with an appeal if they or Is then removed from the platform.
The Fair Share measure requires the city to set a minimum share standard for ride-hailing drivers, but a study is mandatory to determine the amount.