Legislative leaders announced a tentative agreement for Uber and Lyft driver pay that is lower than the Minneapolis city council ordinance, but Uber and Lyft aren’t on board.
Drivers’ advocates say they are willing to accept the proposed rate of $1.27 per mile and 49 cents per minute, lower than the Minneapolis proposal of $1.40 per mile and 51 cents per minute.
“We’re just showing good faith to the residents of Minnesota,” said Eid Ali, executive director of the Minnesota Uber/Lyft Drivers Association, one of the main groups advocating for drivers’ interests.
The rates are slightly higher than the higher of two rates proposed in a March report from the state Department of Labor and Industry that aimed to get driver pay to the state minimum wage and give drivers benefits including paid leave and health insurance. The study suggested that 89 cents per mile and 49 cents per minute would boost drivers’ pay approximately to the minimum wage.
Both the apps and drivers have quibbled with the study’s assumption. Uber spokesperson Josh Gold said the company thinks the study overestimated driver expenses, and the drivers association has argued that the study’s assumptions are unrealistic, such as the idea that city drivers are getting an average of 31 miles per gallon.
State legislative and Minneapolis city council leaders celebrated their agreement in a news release Monday afternoon. The Minneapolis Democrats carrying the bills in the Senate and House, Sen. Omar Fateh and Rep. Hodan Hassan, called the agreement a “win” that would make Minnesota a leader on driver pay.
But spokespeople for Uber and Lyft say they were not part of these negotiations and objected to the proposed rates.
“Uber was not consulted or involved in this conversation. We don’t support it,” said Joel Carlson, a Minnesota lobbyist for Uber.
“[S]hould these statewide rates pass, we would be forced to shut down across all of Minnesota, not just Minneapolis,” said Lyft spokesperson CJ Macklin in a statement.
“I think that they’re bluffing,” said House Majority Leader Jamie Long, DFL-Minneapolis, adding the companies were operating profitably with higher rates of pay elsewhere.
Gov. Tim Walz vetoed a driver pay minimum bill in 2023. A Walz spokesperson called the legislators’ deal a “step in the right direction,” but indicated the governor wants to keep talking with legislators, the companies and Minneapolis leaders.
Uber’s Gold said the company still sees room for negotiation but wants to be part of the discussions. “Right now, the Legislature seems intent to negotiate with the Minneapolis City Council and not us.”
In a phone interview, City Council President Elliott Payne said he and other members are excited about the agreement for a statewide minimum that still allows local jurisdictions to set their own rates, calling it a “win” for Uber and Lyft drivers.
“It’s a compromise, but you have to give a little in that scenario, and we wanted to make sure that our partners in the House and our partners in the Senate could walk away with some success,” Payne said.
Long said he was pleased the Minneapolis council seemed willing to negotiate down from the rates in the city’s ordinance.
While council members want Uber and Lyft to stay in the city, Payne said their goal is for drivers to make a minimum wage.
“This isn’t about negotiating some amount that they agreed to, this is about coming up with a rate that best captures the real expenses experienced by everyday drivers,” Payne said.
Ali, of the drivers’ association, said the agreement was not perfect but he wanted drivers to get a win this session, after the disappointment of Walz’ veto last year.
Both Ali and Mohamed Egal, who leads the separate drivers organization Mulda Members Organization, said they would be happy with the proposed compromise rates.
Neither was concerned about what would happen if Uber and Lyft leave Minnesota, and hoped for more competition, whether from outside companies, a local drivers’ cooperative or even taxi apps.
“We want to make sure we are getting competition into the market so we don’t have the same problems we have had in the past,” Ali said, “which is a duopoly in Minnesota.”
Staff writer Louis Krauss contributed to this report.
Josie Albertson-Grove
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