Travelers in Minneapolis may find it harder to get around if the mayor of Minneapolis signs into law a minimum wage bill for rideshare drivers.
Both Uber and Lyft have threatened to leave the city if the bill becomes law.The Minneapolis City Council passed the ordinance 7-5 votes Thursday. Mayor Jacob Frey has until Aug. 23 to veto the bill. He has expressed support for raising driver wages in the past, but added on Wednesday, “It’s clear we have to allow more time for deliberation.”
Lyft said in a report to the city council on Tuesday that if the bill becomes law, it will cease operations in the city by the end of the year because “prices will likely double and only the wealthiest will be able to afford rides.” In a note to drivers, Uber said, “If this bill is passed, we will unfortunately have no choice but to significantly reduce service and possibly shut down operations entirely.”
The bill would require ride-sharing to pay drivers at least $1.40 per mile and $0.51 per minute.
This isn’t the first time ride-sharing services have threatened to leave cities when municipalities impose regulations. In 2016, both companies said they would abandon the Chicago market after the city proposed requiring drivers to obtain a driver’s license. That same year, they did leave after the city of Austin decided to require fingerprinting background checks on drivers. (Both returned to the market just months after Texas Gov. Greg Abbott signed a measure into law Create a statewide regulatory framework For ride-sharing companies. )
Some states are paying attention to the drivers of the gig economy, though not always in their favor. In 2020, California voters passed a proposal that would allow companies to treat drivers as independent contractors. The measure, heavily funded by ride-hailing companies, also includes minimum income guarantees. New York recently passed a minimum wage for the company’s food delivery workers. Uber and other companies have sued the city seeking a suspension of the law.
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