Lyft and Uber threaten to leave Minneapolis unless mayor vetoes bill giving drivers a minimum wage

Uber and Lyft are both threatening to leave the city if the bill becomes law. The Minneapolis City Council passed the ordinance in a 7-5 vote Thursday. Mayor Jacob Frey has until Aug. 23 to veto the bill. He has voiced support for boosting driver pay in the past, but added Wednesday “it is clear that we must allow more time for deliberation.”

Lyft, in a note to the city council on Tuesday, said if the bill became law it would wind down operations in the city at the end of this year, since “prices could double and only the most wealthy could still afford a ride.” Uber, in a note to its drivers, said, “If this bill were to pass, we would unfortunately have no choice but to greatly reduce service, and possibly shut down operations entirely.”

The bill would require ride shares to pay drivers a minimum of $1.40 per mile and $0.51 per minute.

This isn’t the first time ride share services have threatened to leave a city when municipalities imposed regulations. In 2016, both companies said they would abandon the Chicago market after the city proposed requiring drivers obtain a chauffeur’s license. That same year, they did leave Austin following the city’s decision to require fingerprint background checks on drivers. (Both returned to the market several months later after Texas Gov. Greg Abbott signed into law a measure creating a statewide regulatory framework for ride-share companies.)

Several states are focusing on drivers in the gig economy, though not always to their benefit. California voters, in 2020, passed a proposition allowing companies to treat drivers as independent contractors. The measure, which was heavily bankrolled by ride-hail companies, also included a minimum earnings guarantee. And New York recently passed a minimum pay rate for food delivery workers for app companies. Uber and others have sued the city to suspend the law.