Minneapolis Mayor Vetoes Wage Bill, Cuts Deal With Uber Instead After Meeting With Companies

Minneapolis Mayor Jacob Frey vetoed a ride hail bill that would have guaranteed a minimum wage to all ride hail drivers on Tuesday. 

According to the Associated Press, Frey instead “secured a commitment” with Uber—but not Lyft—to pay drivers in Minneapolis $15.19 an hour for time spent transporting riders in the city, which is already the Minneapolis minimum wage for large companies. Uber and Lyft drivers are classified as independent contractors in Minnesota and not bound by the city’s minimum wage laws for workers.

The bill was approved by the Minneapolis City Council in a 7-5 vote last week and would have guaranteed payment of $1.40 per mile and 51 cents per minute, with a minimum payment of $5 per ride. It would also have guaranteed drivers are paid 80 percent of the cancellation fee if a rider cancels and guaranteed drivers be paid any extra fees charged to the rider.

It also would have created more stringent requirements around “deactivation”—Uber and Lyft’s euphemistic term for banning drivers from the app; ride hail companies would need to provide clear written rules around what warrants a deactivation and provide notice to drivers ahead of such deactivation 5 days beforehand. Drivers would be guaranteed a meeting to discuss the deactivation within 7 days of receiving a notice. And drivers deactivated as of January 1, 2021, could retroactively request such a meeting under the legislation. To garner support from riders with safety concerns, it also mandated deactivations in certain scenarios, including convictions for felony-level harassment or stalking, murder, violating a restraining order, possessing child pornography, carjacking, kidnapping, driving while impaired and “any crime against a rider.”

Frey also sent a letter to the city council ahead of the vote, saying that his staff had met with the driver associations, labor unions, disability advocates, and “TNC providers,” meaning ride hail companies. 

“From the feedback we gathered, it is clear that we must allow more time for deliberation,” Frey said in the letter. Frey said in the letter that the deactivation policies in the bill would hinder safety, saying, “The ordinance is silent on whether a rider will be deactivated after a complaint is filed, making it possible a driver will continue endangering countless other riders.” Frey also said the legislation should include more protections, including higher insurance coverage for riders whose cars are damaged. 

Several left-leaning city council members were outspoken on Twitter about Frey’s veto. Council member Robin Wonsley, who drafted the legislation, tweeted,  “Frey’s own administration helped craft Fair Drives Safe Rides after 8 months of research. Today he vetoed that policy & announced he cut a backroom deal with Uber and Lyft. It’s not a law. It’s a pinky promise w/ the same corporations who’ve exploited drivers for years.” Wonsley tweeted that Frey “caved to corporate lobbying” and said that talk of compromise was a “stall tactic.”

Aisha Chughtai, another council member who supported the bill tweeted, “As a person who is pretty familiar with receiving veto letters from Mayor Frey, let me remind you: In his ~6 years as Mayor, Jacob Frey has vetoed 9 Council actions. Of these, all were authored by Councilmembers who represent Southsiders. 7 were authored by people of color.”

Council member Jeremiah Ellison tweeted, “So, a hollow promise from a tech corporation is good governance, but a vetted ordinance earns the scorn of the mayor and a *minority* of my council colleagues? It’s ridiculous.”

Frey’s veto comes months after Minnesota Governor Tim Waltz vetoed a similar statewide bill in May. Prior to the statewide veto in May, Uber and Lyft had both threatened to remove their service from Minnesota, with the exception of the Twin Cities area, if the legislation passed. 

Both companies then echoed those threats for Minneapolis, saying they would pull the service out of the city if a bill was passed. In a letter to the Minneapolis City Council ahead of last week’s vote, a Lyft spokesperson said that the legislation would “make rider fares too high, significantly undercut driver earnings by reducing ride volume, and ultimately create too great a safety risk for riders for Lyft to operate in Minneapolis.” The letter also claimed that the new deactivation process requires too high a burden of proof and would require Lyft to reach out to victims of sexual violence in order to prevent a rider from being reactivated. 

In an email to Motherboard, Uber spokesperson Freddi Goldstein said, “It remains our goal to pass comprehensive, statewide legislation that will raise rates for drivers without sacrificing ridership. In that effort, we look forward to continued work on the Governor’s Task Force.” Goldstein echoed Frey’s request that the state legislature take up the issue again, saying, “We appreciate Mayor Frey’s thoughtful approach and the opportunity to continue working together to get this right and hope the Minnesota legislature quickly passes a statewide compromise in February.”

“Mayor Frey was right to listen to drivers, riders and our communities and reject the proposal,” a Lyft spokesperson told Motherboard in an email. “By attempting to jam through this deeply-flawed bill in less than a month, it threatened rideshare operating within the city. We support a minimum earning standard for drivers, but it should be part of a broader policy framework that balances the needs of riders and drivers. Minneapolis drivers on Lyft last quarter earned on average more than $37 per utilized hour, including tips and bonuses. We’re committed to continue collaborating with stakeholders at both the state and local level on a sustainable solution that improves on this for everybody moving forward.”

On Twitter, State Senator Omar Fateh said he planned to pass statewide legislation, writing,  “I will not allow our state to stand by and watch as our workers continue to be screwed over.”