June 6, 2023

The Minnesota Senate passed a bill Sunday that would guarantee Uber and Lyft drivers a minimum wage and other benefits, sending the measure to Gov. Tim Walz.

The bill will end Monday’s session after a 35-32 vote in the state House of Representatives, which passed in a 35-32 vote earlier this week, capping a dramatic week of political maneuvering. before the legislature. Uber and Lyft drivers are called gig workers because they are considered independent contractors, meaning they are responsible for their own expenses and are not guaranteed a minimum wage, health care or other benefits.

If the governor signs the bill, it would require Uber and Lyft to pay their drivers a driver fee of at least $1.45 per mile, or $1.34 per mile outside of Minneapolis-St. Louis. Paul area – and $0.34 per minute. It has also established an appeals process through which drivers can request a review if they believe they have been inappropriately suspended from the platform, and demanded more transparency on how drivers’ earnings are calculated.

mr waltz has known as The bill is “an important piece of legislation” but also explain More conversations are needed before he commits to signing.

The bill is a rare victory for labor advocates in a protracted multistate battle over the rights of gig drivers and their place in the economy. Uber and Lyft have long argued that their drivers are independent contractors, not employees. Drivers prefer being contractors because it gives them the flexibility to choose their hours, and many only work part-time, they said.

But labor advocates argue that drivers are being exploited by companies and misclassified as independents, even as ride-hailing services exert significant control over their jobs.

The federal government has largely avoided engaging in the debate, and the U.S. Department of Labor has not sued or targeted Uber or Lyft for misclassifying workers. Instead, the issue has played out in state courts and legislatures, as well as ballot measures.

New York City and Seattle have passed laws guaranteeing minimum wages for gig drivers, and the companies have their favorite rules on the books in California and the rest of Washington state. Both states have enacted laws guaranteeing drivers access to benefits such as a minimum wage, but also barring them from being employees. Last year, a Massachusetts judge struck down a similar, company-backed effort.

Senator Omar Fateh, one of the bill’s authors, cheered its passage. “These workers deserve a subsistence wage to support themselves and their families.”

Mr. Fatah, from the Uber/Lyft Drivers Association of Minnesota, which supports the bill, and gig drivers celebrated outside the legislative chamber on Sunday.

Uber expressed disappointment with the passage of the bill. “For months we have been pleading with lawmakers to work with us to increase rates for drivers without harming passengers, but our pleas have been ignored for months,” said spokesman Freddie Goldstein , adding, “We hope Governor Walz will reject the bill.”

Uber and Lyft argue that the bill raises wages too high and that disabling the appeals process would limit their ability to ban drivers accused of misconduct.

The companies say the extra cost will be passed on to riders, forcing them to pay more, and they’re offering $1.17 per mile and $0.34 per minute as guarantees. Uber said it may reduce service in Minnesota — a threat it has made in other states in the past. Lyft made a similar threat in a letter to the governor, saying on Sunday, “We are asking Governor Walz to veto this bill and create a task force to properly study the best ways to protect drivers while still maintaining the integrity of the service.” Affordability.”

“If this bill passes, unfortunately, we will have no choice but to significantly reduce service across the state and potentially shut down operations entirely,” Uber said in a message to Minnesota customers.

Lyft warned its customers that if the bill passed, their fares could more than double, turning “ridesharing into an expensive luxury.”

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