New York
CNN
—
Lyft and Uber will cease providing companies in Minneapolis on Might 1 after town council overrode the mayor’s veto of a minimum wage for rideshare drivers.
The metropolis council on Thursday voted 10-3 in favor of the override, permitting rideshare drivers to be paid the native minimal wage of $15.57 an hour.
Lyft mentioned in a press release the invoice was “deeply flawed” and that the ordinance makes its “operations unsustainable.”
“We help a minimal incomes commonplace for drivers, however it ought to be completed in an trustworthy manner that retains the service inexpensive for riders,” mentioned a Lyft spokesperson.
Uber mentioned in a press release obtained by CNN that it’s “disillusioned the council selected to disregard the information and kick Uber out of the Twin Cities, placing 10,000 folks out of labor and leaving many stranded.”
Mayor Jacob Frey, a Democrat, mentioned he helps a minimal wage for rideshare drivers however opposed the ordinance as a result of it didn’t think about a Minnesota state examine that analyzed how a lot drivers ought to be paid.
“Everybody desires to see Uber and Lyft drivers receives a commission extra. However getting a increase doesn’t do a complete lot of excellent should you lose your job,” Frey mentioned, in accordance with CNN affiliate WCCO-TV. “There will likely be a large influence felt by our area.”
The ordinance mandates rideshare drivers make a minimum of $1.40 per mile and $0.51 per minute inside Minneapolis. Nevertheless, the analysis Frey referred to confirmed decrease numbers — $0.89 per mile and $0.49 per minute — to make minimal wage.
“We shouldn’t be afraid of information, we ought to be embracing it. We shouldn’t be ignoring research that come out, we ought to be using them and creating the very best coverage,” Frey instructed WCCO-TV.
The mayor is imploring native politicians to provide you with an answer earlier than Might 1. The rideshare companies say that consumer costs would double in the event that they stayed within the metropolis.
Minneapolis is debating the minimal wage as gig employees throughout the nation are advocating for honest wages and job advantages. Cities and states have tried to go laws lately amid the expansion of the “gig financial system,” or freelance work by apps like Uber and Grubhub, however have typically been met with fierce opposition.
Final yr, Minnesota Gov. Tim Walz, a Democrat, additionally vetoed a bill that may have set a minimal wage for rideshare drivers, saying it will make Minnesota “some of the costly states within the nation for rideshare.”
Lyft beforehand instructed CNN that the invoice can be detrimental to drivers, who would finally earn much less, “as a result of costs might double and solely essentially the most rich might nonetheless afford a experience.”
In 2020, California handed Proposition 22, which was backed by greater than $200 million from essentially the most influential gig financial system firms. The controversial ballot measure permits Uber and Lyft to deal with drivers as unbiased contractors quite than staff. Whereas it was a serious win for Uber and Lyft, it did embody a minimal earnings assure (excluding the time a driver spends ready for a gig).
Final June, New York Metropolis introduced a new minimum pay rate for meals app supply employees amid the rise in the usage of companies like Uber Eats and DoorDash for the reason that pandemic. Uber and different meals supply apps sued the city in July, sustaining that the regulation would harm supply employees greater than assist them.
–CNN’s Jennifer Henderson and Ramishah Maruf contributed to this report.