In a move that could set a precedent in other cities, Seattle has just passed legislation that will allow Uber and Lyft drivers to unionize, meaning they can negotiate pay and benefits. The implications are significant, because the on-demand driving startups currently classify their drivers as contractors and not full-time employees.
The Seattle City Council voted 8-0 in support of the legislation, but it is likely that the affected companies will appeal. In addition to driving apps, taxis and for-hire transportation companies are also impacted.
“We’ve heard from Seattle drivers making sub-minimum wage, and companies like Uber have turned a deaf ear to their concerns. This bill was only introduced out of necessity after witnessing how little power drivers themselves had in working for a living wage,” said Councilmember Mike O’Brien, in a statement. “This is groundbreaking legislation and I am proud Seattle is continuing to lead the nation in advancing labor standards for our workers.”
While the Seattle ruling does not technically classify Uber drivers as employees, it does give them more rights than freelancers. Helping with everything from food deliveries to house cleaning, on-demand startups are becoming more commonplace, and many of them classify their workers as 1099 and not W-2 employees.
Proponents of reform say that on-demand employees are working long hours without health care and adequate employee rights, but others say that the flexible schedule of freelancing is what attracted many of the on-demand workers to the jobs in the first place. Some Uber drivers have other gigs and life commitments.
An Uber spokesperson told TechCrunch, “Uber is creating new opportunities for many people to earn a better living on their own time and their own terms. Drivers say that with flexible and independent work with Uber, 50% of them drive fewer than 10 hours a week, 70% have full-time or part-time work outside of Uber and 65% choose to vary the hours they drive 25% week-to-week.”
A statement from Lyft says that “Lyft provides consumers with convenient and affordable transportation, and drivers with the ability to make money in their free time. Lyft drivers are entirely in control of where or when they work, and this flexibility is exactly why the service is so popular with with people looking to make extra income. Unfortunately, the ordinance passed today threatens the privacy of drivers, imposes substantial costs on passengers and the City, and conflicts with longstanding federal law. We urge the Mayor and full Council to reconsider this legislation and listen to the voices of their constituents who choose to drive with Lyft because of the flexible economic opportunity it offers.”
Yet Seattle Mayor Ed Murray does not support the bill, which does not require this signature. In a statement, he said “I remain concerned that this ordinance, as passed by the Council, includes several flaws, especially related to the relatively unknown costs of administering the collective bargaining process and the burden of significant rulemaking the Council has placed on City staff.”
It is likely that the debate will continue in the coming months.