Minneapolis City Council members may postpone start of Uber, Lyft minimum wage ordinance by two months

With a vote looming this week to reconsider Minneapolis’ new rideshare minimum wage law, City Council President Elliott Payne and Council Members Katie Cashman and Aurin Chowdhury say they will seek to push back the ordinance’s effective date by two months, to July 1.

The council members say the delay would allow them to collaborate with state lawmakers and provide more time for new rideshare startups looking to enter the metro market. Multiple companies have expressed interest in operating in the Twin Cities to fill the gaps left by Uber and Lyft, which have pledged to leave the city once the ordinance takes effect.

The city’s rideshare ordinance, passed last month over Mayor Jacob Frey’s veto, has caused increasing consternation among business groups and disability and senior advocates, as its start date of May 1 nears.

Council Member Andrea Jenkins, who voted for the ordinance, has asked the council to reconsider it at its Thursday meeting.

Payne, Cashman and Chowdhury say they’re open to changes, and will seek to extend the implementation date to July 1. The three members should provide enough votes to enact the delay.

“This is a good faith extension for us as Council Members to work on our legislative process, collaborate with leaders in the state, ensure drivers have the fair compensation they need, and support emerging rideshare companies and riders adopting them,” the three said in a joint statement Wednesday. “It is on Uber and Lyft to decide if they will treat their workers fairly, pay them adequately, or continue their egregious behavior in scaring the public with their threats to leave the people of Minneapolis behind.”

Uber spokesman Josh Gold said Wednesday that the company would continue to operate in Minneapolis until July 1 if the council pushes back the effective date.

“The proposed delay gives us more time to continue to work with state leaders on a comprehensive statewide solution that raises pay across the state, protects flexibility and keeps rides affordable,” he said.

City and state analyses show that the two rideshare currently compensate drivers — many of them working class immigrants — less than Minneapolis’ minimum wage. But at the city’s prescribed rates of $1.40 per mile and 51 cents per minute, Uber and Lyft have threatened to abandon the market, saying it will be too costly to operate here. The move would be chaotic in the near term, before competing rideshare startups have gotten a chance to get licensed and recruit drivers, representatives of Minneapolis-St. Paul International Airport and the hospitality industry declared in a news conference earlier this week.

Four new rideshare companies have applied for license to work in Minneapolis, but none has yet completed the process.

A majority of 13 council members must agree to reopen the ordinance for further consideration on Thursday before amending it in any way, including changing the effective date.

The ordinance’s original authors, Council Members Robin Wonsley, Jason Chavez and Jamal Osman also issued a joint statement Wednesday, saying they will support delaying implementation to July 1 — but not support rescinding the ordinance or changing the rate if it would result in drivers continuing to be paid below Minneapolis’ minimum wage of $15.57.

The co-authors said they will introduce a proposal Thursday to ensure fare transparency by requiring that rideshare companies send receipts to both riders and drivers showing how much the driver was paid, as well as mandating that rideshare companies make regular reports to the city.

“Uber and Lyft drivers are being paid a subminimum wage and that is fundamentally wrong and goes against our shared values. We passed this ordinance because the current rideshare system is broken, and we were shocked to see the way it is leading to exploitative labor practices,” according to the statement from Payne, Cashman and Chowhury. “Inaction was not and is not a choice.”

Uber and Lyft have said they may be willing to stay if drivers’ compensation rates were limited to more modest raises, such as the rate of 89 cents per mile and 49 cents per minute, identified in a state Department of Labor and Industry report.

Meanwhile, Council Members Jenkins and Emily Koski also issued a joint statement Wednesday saying they will propose amending the ordinance rate to $1.21 per mile, as recommended in the state report while maintaining the city’s per-minute rate of 51 cents, and to conduct evaluations six months and one year from the implementation date. Jenkins and Koski both support moving the effective date to July 1.

“This is the only plan to address the rate disparities that has been presented clearly to the public and will bring efficient, expedited resolution to this matter,” said the statement. “It’s time to move forward based on both our intentions and on the current data available — not one-or-the-other.”