Minneapolis passes minimum wage for rideshare drivers after Uber threatens to leave

Uber also claims the ordinance would "greatly limit" its ability to remove "unsafe drivers" from the platform.

Minneapolis City Hall/Shutterstock

(The Center Square) — The Minneapolis City Council passed an ordinance starting Jan. 1, 2024, that rideshare companies say will force them out of the city because of increased costs and regulations.

The vote passed 7-5-1 Thursday to enact a minimum compensation of $1.40 per mile and $0.51 per minute while transporting a rider, subject to annual adjustment.

Minimum compensation only applies for ride portions occurring within the city, and the per-mile and per-minute minimum rates would be tied to the municipal minimum wage every Jan. 1.

In an email sent to frequent customers Monday, Uber said the legislation “could force Uber to leave the city.”

The email said the legislation would “greatly limit our ability to remove unsafe drivers from the platform, including drivers accused of sexual assault, harassment, impaired driving, or discrimination,” and significantly increase the costs of Minneapolis’ Ubers to possibly more than Manhattan costs.

The ordinance moves to Mayor Jacob Frey, who holds veto power over the proposal but whose office hasn’t yet sent a statement of his position.

Ward Six Council Member Jamal Osman welcomed the passage.

“Just as any other employee in Minneapolis deserves protection, drivers should also be afforded the same rights and protection,” Osman told The Center Square in an email.

“The corporate pressure presented by Uber and Lyft to withdraw their services is absurd. Uber and Lyft trying to scare us with their threat to leave doesn’t impress us. These companies need to care more about their drivers than just making money. We won’t give in to their pressure tactics. We’re standing strong together. It’s time for these corporations to prioritize their drivers over corporate greed.”

In a letter to the council, Lyft said the ordinance “could turn rideshare into a luxury service” by doubling trip costs within Minneapolis.

“A trip today that would cost $20, could cost $40 next year,” the letter said. “Simply put, most Lyft riders in Minneapolis could no longer afford to use Lyft.”

Minneapolis City Council Member Robin Wonsley posted on social media: “Today we are proud that the majority of the Minneapolis City Council stood with The Mulda against corporate lobbyists and passed a policy that will protect basic workers’ rights and provide dignified wages for thousands of Uber and Lyft drivers.”

In a statement, Uber said “We are disappointed by the results of yesterday’s vote and the overall process in Minneapolis. We are determining next steps.”

Lyft hasn’t yet responded to a request for comment.


Scott McClallen
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Scott McClallen is a staff writer covering Michigan and Minnesota for The Center Square. A graduate of Hillsdale College, his work has appeared on Forbes.com and FEE.org. Previously, he worked as a financial analyst at Pepsi.