Lawmakers, Minneapolis council members reach rideshare driver deal — but Uber and Lyft aren’t on board (2024)

Chief authors of legislation setting a minimum wage and employee protections for rideshare drivers in Minnesota announced Monday they’ve reached a deal with Minneapolis City Council members.

But the rideshare companies that have threatened to pull out of Minneapolis if the city’s ordinance goes into effect say they’ll stop operations in Minnesota if the statewide legislation is enacted.

The agreement at the state Legislature would set both Minneapolis and statewide wages for drivers at $1.27 per mile and $0.49 per minute. The bill’s authors say the amendment to the proposed legislation will be introduced at the House Labor and Industry Finance and Policy Committee Tuesday.

House Majority Leader Jamie Long, DFL-Minneapolis, called it a “compromise agreement” in a statement, and said the numbers are in line with other major cities across the country that ensure drivers are fairly paid.

Long told reporters that he thinks the rideshare companies are “bluffing” about leaving the state.

“They’re operating in Washington state at rates that are above what we’re proposing, well above in terms of the per-minute-rate,” Long said. “So, I do believe they would stay if this passed.”

Minneapolis City Council President Elliott Payne said the legislation lives up to the DFL Party’s core value of ensuring that every worker can earn a minimum wage. He said the rideshare companies’ reactions were disappointing.

“Every step along the way, they’ve said, ‘This isn't workable, we’re going to leave if you do that,’” Payne said. “And you know what’s not workable is allowing folks to live and work in the city of Minneapolis earning sub-minimum wage wages just for the sake of the preferences of independent corporation.”

A Lyft spokesperson said in a statement that they continue to “support a minimum earnings standard for drivers” but that the state numbers “would be incredibly damaging for both riders and drivers.”

“Rides would become unaffordable for most across the state, not just in Minneapolis, and drivers would earn even less,” according to the Lyft spokesperson. “It would make the service unsustainable in Minnesota and we would be forced to shut down throughout the state, should it pass.”

An Uber spokesperson said it’s unfortunate that members of the Legislature are “allowing the Minneapolis City Council to drive a decision that impacts millions of people who don’t live in the city.”

Uber has made “serious offers” on a minimum wage and said they hope to work with Gov. Tim Walz and the members of the Legislature on a statewide solution that allows them to keep operating in the state.

Republicans at the Capitol blasted Democrats for making the deal without consulting rideshare companies about the rates.

“This is a very dangerous game of chicken for legislative Democrats to be making,” Sen. Jordan Rasmusson, R-Fergus Falls, said. “I don’t think Uber and Lyft are bluffing. I think there’s a real risk that tens of thousands of Minnesotans are the collateral damage of this reckless policy.”

They said DFL leaders should come back to the table to put a bill together that would allow Uber and Lyft to continue operating in Minnesota.

“At a time when we’re dealing with real problems and real crises, to have one created purely by politicians — it’s exceptionally frustrating,” Rep. Pat Garofalo, R-Farmington, said. “And everyone would benefit if the DFL would just sit down and compromise.”

The Minneapolis City Council previously passed an ordinance giving drivers $1.40 a mile and $0.51 cents a minute that’s set to go into effect in July, but the city would adopt the state numbers if passed.

The Minneapolis ordinance was strongly criticized by the rideshare companies Uber and Lyft, who argued that the boost in pay would make rideshares unaffordable and even hurt drivers’ wages. Both companies threatened to stop providing service in Minneapolis when the ordinance goes into effect.

The negotiations at the state Legislature with Minneapolis council members were seen as a way to prevent the companies from leaving. Minneapolis council members pushed back the city ordinance’s date from May to June partly to allow the negotiations to take place.

A spokesperson for Gov. Tim Walz said the new proposal is a “step in the right direction”

“The Governor’s goal remains to be finding a solution that ensures workers are paid fairly while allowing these essential services to remain in Minnesota. He will continue discussing this issue with legislative leaders over the coming days,” the statement said.

Walz vetoed statewide legislation last year that would have given drivers a boost in pay and more workplace protections.

A task force at the state level made up partly of rideshare drivers and companies failed to find consensus on wages. The Minneapolis ordinance was vetoed by Mayor Jacob Frey, but a supermajority of the council voted to override his veto.

One new company, MyWeels, has already completed the city’s licensing process to become a rideshare company, according to a city spokesperson. Two other companies, Wridz and MOOV, are in the final stages of the application process and still need to submit payment and insurance information.

The amendment is set to come up for a House committee hearing Tuesday and is expected to come before a Senate committee the next day. Long said the measure could undergo changes before making it to the House and Senate floor.

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