Uber and Lyft drivers file out of the waiting lot at the Minneapolis-St. Paul International Airport after being dispatched to pick up passengers on May 13, 2024. Photo by Max Nesterak/Minnesota Reformer.
Less than a year after the Minnesota Legislature passed a sweeping bill raising wages for Uber and Lyft drivers, two Democrats announced plans to create a path for drivers to unionize.
Because they’re treated like independent contractors and not employees, Uber and Lyft drivers aren’t able to unionize under the federal labor law.
“Right now, labor law claims that these drivers don’t have the right to form a union like most workers, denying them the best path forward to fix the industry,” said Sen. Zaynab Mohamed, DFL-Minneapolis, during a Tuesday news conference with drivers and leaders from the Service Employees International Union. “The best way to hold these companies accountable is to give drivers a seat at the table.”
The bill is modeled off a law in Massachusetts, which became the first state to allow drivers on apps like Uber and Lyft to unionize through a ballot initiative passed by voters last November.
The drivers and their labor allies will need at least one Republican vote in the Minnesota House, where the traditionally anti-union GOP holds 67 votes out of 134; 68 are needed for passage.
The bill is still being drafted, but lawmakers shared a framework would create a process for drivers to unionize, overseen by the state’s Bureau of Mediation Services, which manages public sector union campaigns and labor disputes.
Under the proposal, if a union signs up 10% of eligible drivers, transportation network companies would have to turn over a list of drivers in Minnesota, with contact information. Then, if 25% of all drivers who’ve completed at least 100 rides in the previous three months sign up to join the union, it would become the exclusive representative in negotiating wages, benefits and working conditions. Union dues would be entirely voluntary under the bill.
Union proponents of the bill say drivers should be able to negotiate directly with the companies as a group rather than have to go through the Legislature.
“The Legislature does not need to be the HR of huge multimillion dollar global corporations like Uber and Lyft,” said Greg Nammacher, president of SEIU Local 26.
The proposed bill in Minnesota doesn’t challenge drivers’ classification as independent contractors, which offers flexibility and tax advantages for both companies and drivers but excludes them from nearly all labor protections like overtime, conventional minimum wages and unemployment insurance.
The Massachusetts law states that drivers are not employees, but the Minnesota proposal would seem to leave the door open for a legal battle over the drivers’ classification.
Freddi Goldstein, a spokeswoman for Uber, said the company has worked collaboratively with drivers and lawmakers over the last two years.
“It is not constructive to have late-to-the-game parties show up to risk what’s been achieved to advance their own interests,” she said in a statement.
Last year, lawmakers set minimum pay rates for drivers, increased insurance requirements and added procedures for firings — or “deactivations.” The law also requires Uber, Lyft and other companies to contract with a nonprofit organization to provide driver services like technical assistance and appealing deactivations.
Lyft said it contracted with Minnesota Somali Community Center to provide driver services but did not disclose how much it is paying the organization. Uber partnered with the Confederation of Somali Community and also declined to comment on the value of the contract.
The new wage floor took effect in December and set minimum pay rates for drivers at $1.28 per mile and 31 cents per minute before tips when transporting a passenger, and will be adjusted annually with inflation like the minimum wage. (The rate is guaranteed on average over two weeks, not per trip.)
The rate equates to about $34 per hour for Twin Cities drivers when they are logged in and accepting fares — a 14% increase from the average metro area driver’s earnings in 2022 — according to an analysis by the Service Employees International Union, based on a state study of driver earnings. Uber said riders would see a 25% increase in the price.
Abdi Haybe, a rideshare driver and security guard unionized with SEIU Local 26, said the law passed last year wasn’t enough.
“We’re still struggling all the time,” he said.