Access To Lyft, Uber in Jeopardy for Minneapolis After City Council Vote on Driver Wages

The Minneapolis City Council has voted in favor of an ordinance that raises wages for ride-hailing app drivers in the city.

The law, approved on Thursday, fixes minimum compensation for drivers at $0.51 per minute and $1.40 per mile, an arrangement Uber and Lyft fought to avoid. It is yet to be signed by the city’s Mayor Jacob Frey.

The ordinance allots more rights to drivers, including the ability to appeal account deactivations and suspensions by ride hailing platforms.

Uber and Lyft had threatened to stop operating in Minneapolis as a result of the law, affecting some 450,000 people. 

Lyft told The Messenger it would shut down operations in the city by January 1, 2024 if the law comes into effect. Uber had previously said it would be “unfortunate” but it would have “no choice but to greatly reduce service, and possibly shut down operations entirely” if the law is approved.

While the bill was approved 7-5 by city council members, it failed to win the minimum number of votes to avoid a potential veto by Mayor Frey. A separate state-wide bill had already been vetoed by the Minnesota State governor.

“This bill has been jammed through the Council in less than a month with little consideration for its consequences,” Lyft told The Messenger. “If it becomes law, drivers would ultimately earn less because prices could double and only the most wealthy could still afford a ride.”

Lyft said that while it supports a minimum wage standard for drivers, “it should be part of a broader statewide solution that also protects driver independence." 

Uber told The Messenger it was “disappointed by the results of today’s vote and the overall process in Minneapolis.”

“We are determining next steps,” the company said.