Seattle to Require Rideshare Drivers Be Paid Hourly Minimum Wage

Credit: The New York Times

All Uber and Lyft drivers must be paid at least $16 an hour.

An ongoing controversy for rideshare companies like Uber and Lyft is the lack of a steady wage for their drivers. Both companies have repeatedly argued that the lack of a steady, hourly rate for drivers is what allows them to keep customer fares down, which in turn allows drivers to pick up more customers. While this stance was controversial in normal times, in the age of the COVID-19 pandemic, it has become even more problematic. Many rideshare drivers can’t pick up enough customers in a day to make ends meet due to fears of viral transference.

“The pandemic has exposed the fault lines in our systems of worker protections, leaving many frontline workers like gig workers without a safety net,” said Mayor Jenny Durkan in a statement.

In order to preserve these drivers’ livelihoods, Seattle has written some new legislation. This morning, Seattle’s city council unanimously approved a new requirement for rideshare companies operating in their city: all companies must pay their drivers at least $0.56 per minute while a customer is in the vehicle, on top of the usual per-mile rates. This increase ensures that, factoring in time spent waiting for customers and driving to pick-up locations, drivers can still make an hourly wage of $16.39, meeting the state’s minimum wage requirements. Ridesharing companies will also be required to hand all tips over to drivers and not count them toward the minimum wage. Protective equipment costs must also be reimbursed to drivers.

Credit: KOMO News

The companies aren’t happy with this new change. “The city’s plan is deeply flawed and will actually destroy jobs for thousands of people — as many as 4,000 drivers on Lyft alone — and drive ride-share companies out of Seattle,” a Lyft spokesperson told the New York Times.

Despite the Lyft’s concerns, the Seattle city counsel seems pretty upbeat about these changes, and is considering extending them to other subsets of the gig economy. “I hope in the future we can work on similar legislation for other drivers … such as delivery drivers of packages as well as delivery drivers of meals and food,” said council member Lisa Herbold.

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