Seattle Passes Minimal Pay Charge for Uber and Lyft Drivers

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The Seattle Metropolis Council authorized a minimal pay customary for Uber and Lyft drivers on Tuesday, turning into the second metropolis within the nation to take action.

Beneath the legislation, efficient in January, ride-hailing firms should pay a sum roughly equal, after bills, to town’s $16 minimal hourly wage for companies with greater than 500 staff.

“The pandemic has uncovered the fault strains in our techniques of employee protections, leaving many frontline staff like gig staff with no security internet,” Mayor Jenny Durkan stated in an announcement.

Seattle’s legislation, handed in a 9-to-0 vote, is a part of a wave of makes an attempt by cities and states to control gig-economy transportation providers. It’s modeled on a measure that New York City passed in 2018. Final yr, California authorized laws successfully requiring Uber and Lyft to classify drivers as employees rather than independent contractors, which might guarantee them of protections like a minimal wage, additional time pay, staff’ compensation and unemployment insurance coverage. The businesses are backing an initiative on the November poll that may exempt their drivers from the California legislation.

Uber and Lyft have acquired extra favorable therapy from federal regulators. Final week, the Labor Department proposed a rule that may most likely classify their drivers as contractors, although it could not override state legal guidelines like California’s.

As in New York, the Seattle legislation will create a system for minimal compensation for every journey — a mixture of per-minute and per-mile charges which might be “scaled up” by what is named the utilization charge, or the fraction of every hour throughout which drivers have a passenger of their automobile. The thought is {that a} decrease utilization charge ought to correspond to the next per-minute and per-mile charge, to compensate drivers for being much less busy.

The system is meant to provide hourly pay of slightly below $30 earlier than bills and to encourage the businesses to maintain their drivers busier relatively than flood the market with automobiles to cut back passengers’ waits.

A Lyft spokesman, CJ Macklin, stated, “Town’s plan is deeply flawed and can truly destroy jobs for 1000’s of individuals — as many as 4,000 drivers on Lyft alone — and drive ride-share firms out of Seattle.”

Uber declined to remark, however stated in a latest letter to the Seattle Metropolis Council that New York’s coverage had resulted in fewer rides and better costs for passengers, and that it had led the corporate to limit the variety of drivers on the platform without delay.

Michael Reich, a labor economist on the College of California, Berkeley, who was an architect of the New York measure and suggested Seattle on its new legislation, stated that common driver pay had elevated in New York and that total income had risen sufficient to offset the drop in demand due to greater fares.

The expansion in rides slowed after the coverage went into impact, Mr. Reich stated, however added that this was largely for causes unrelated to the coverage.

Past the pay customary, the Seattle measure stipulates that the businesses should hand over all tricks to drivers, that the information can not rely towards the minimal and that the businesses should present protecting tools like masks to drivers or reimburse them for these prices.

A broader program proposed by Ms. Durkan, Fare Share, was authorized final fall. The agenda included a tax on Uber and Lyft of 51 cents a trip, a part of which has helped fund a streetcar mission downtown and supply help for drivers, together with assist with appeals if they’re faraway from both platform.

The Fare Share measure required town to set a minimal pay customary for ride-hailing drivers, however mandated a study to find out the quantity.


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