Uber and Lyft responded by saying they would stop serving the Minneapolis area when the ordinance takes effect May 1, causing the city to weigh the ordinance it passed. The state could also take action, while riders and drivers are left wondering what could come next.
Here is what we know so far:
WHAT HAPPENED?
The Minneapolis City Council last month overrode a mayoral veto and passed an ordinance that requires ride-hailing companies to pay drivers a minimum rate of $1.40 per mile and $0.51 per minute — or $5 per ride, whichever is greater — excluding tips, for the time spent transporting passengers in Minneapolis.
Supporters of the ordinance said the rate would ensure that companies pay drivers the equivalent of the city’s minimum wage of $15.57 per hour.
Council Member Jamal Osman, who co-authored the ordinance, said in a statement: “Drivers are human beings with families, and they deserve dignified minimum wages like all other workers. ... the Minneapolis City Council will not allow the East African community, or any community, to be exploited for cheap labor.”
Many East African immigrants in the Minneapolis area work as Uber and Lyft drivers and have advocated for the rate increase.
However, a recent study commissioned by the Minnesota Department of Labor and Industry found that a lower rate of $0.89 per mile and $0.49 per minute would meet the $15.57 per hour goal.
WHAT ARE UBER AND LYFT DOING?
Uber and Lyft said they can support the rate from the state’s study. But if the higher rate from the Minneapolis ordinance goes into effect, the companies said they will leave the market May 1.
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