Minimum wage for Uber, Lyft drivers awaits action from Walz
Ride-share companies oppose the bill and are urging the Minnesota governor to veto it. Backers say it's crucial to provide a living wage and basic employee protections.
ST. PAUL — A bill guaranteeing a minimum wage and setting rules on firing for ride-share drivers has passed in both the Minnesota Senate and House, but will it become law?
After a final Senate vote Sunday night, May 21, base pay rates for miles and time for Uber and Lyft drivers are now on their way to the governor’s desk for final approval. So far, Gov. Tim Walz, a Democrat, has not said what he plans to do.
Ride-share companies oppose the bill and are urging the governor to veto it. Backers say it's crucial to provide a living wage and basic employee protections for drivers, who are “gig workers” paid by companies under contract and lack similar protections to full-time employees.
“The purpose of this bill is to correct a serious problem, an injustice and an abusive situation that exists toward drivers,” said Sen. Omar Fateh, DFL-Minneapolis, who introduced the legislation.
As he introduced the bill for final passage in the Senate on Sunday night, Fateh said the cost of fuel and vehicles combined with lower compensation rates than in the past mean drivers are struggling.
Under the bill passed by the Senate 35-32 on mostly party lines, Minimum driver compensation rates for trips that start in the seven-county Twin Cities metropolitan area (Carver, Dakota, Hennepin, Ramsey, Scott and Washington) would start at $1.45 per mile and 34 cents per minute. In the rest of the state, the floor for driver compensation would start at $1.25 per mile and 34 cents per minute.
Once new rates are implemented, they’d be adjusted based on inflation each year starting in July 2024.
Drivers would be entitled to 80% of a cancellation fee from the ride-share company if they’ve already departed to pick up a rider.
Fateh said many drivers can be terminated without warning based on complaints that companies do not investigate. Protections against termination would require ride-share companies to disclose their policy on termination and provide an explanation to drivers as to why the company deactivated their driving accounts. Drivers could provide their side of a story and appeal a decision.
Ride-share company Uber has said the bill could cause trip costs to double and force the end of operations in Minnesota.
"For months, we begged legislators to work with us on a compromise that raises rates for drivers without hurting riders, and for months our pleas were ignored,” the company said in a statement. “Unfortunately, what we’re left with is a bill rushed through in the final hours that will leave hundreds of low-income and disabled riders stranded and thousands of drivers without work.”
Fateh did lower the base compensation amount in the bill and removed other provisions that ride-share companies found objectionable, but it did not win the favor of Uber or Lyft.
But while the bill awaits his signature, Walz has not said whether he supports the bill. At this point, there are three possibilities: the governor could sign the bill, veto it or do nothing and have the bill go into effect automatically.
Asked about the bill Sunday, Walz told reporters he’d need to have executive branch agencies under his direction take a look at how the bill might work if it became law.
“We’ve said all along that this is an economy that needs to be looked at,” the governor said. “We’re responsible for the implementation, so we have questions on a lot of areas that need to be answered before they come to us.”
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