Lyft, Uber and unions again new Washington state laws defending drivers

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(GeekWire Photo / Kurt Schlosser)

Washington state lawmakers have approved first-of-its kind legislation that sets a minimum wage and other benefits for Lyft and Uber drivers, while maintaining their status as gig workers and not company employees.

The statewide bill offers a compromise between the interests of drivers and ride-hailing companies. It has support from labor groups including Teamsters Local 117; Drivers Union, a teamster’s affiliate; and the Washington State Labor Council as well as Lyft and Uber.

“It’s been everyone at the table to find a solution,” said Rep. Liz Berry, lead sponsor of the legislation.

Lawmakers this week are expected to reconcile the differences between the versions of the bill that have passed the House and Senate. Berry, a Democrat from Seattle, expects Gov. Jay Inslee to approve the legislation.

“I’m really proud of what we did,” Berry said. “We secured these drivers the same essential protections that other employees receive under state laws.”

If passed into law, HB 2076 will:

  • set a minimum wage for drivers during the time they have passengers, with a higher rate for drivers in larger cities; the rates are tied to the state’s minimum wage and increase accordingly;
  • provide drivers with paid sick leave, which is accrued only during the time they’re carrying passengers;
  • creates the Driver Resource Center, an organization managed by the state’s Department of Labor and Industry that provides employment protections for drivers;
  • establishes rights for drivers, including their ability to work the hours they want and allowing them to drive for multiple ride-hailing companies at once;
  • sets statewide regulations for the ride-hailing companies;
  • instructs the state to form a stakeholder group to decide how the companies and drivers will fund unemployment benefits, paid family medical leave and long-term care benefits.
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In her testimony last month to lawmakers, Jen Hensley, Lyft’s head of government relations, said the bill was the “culmination of years of work” with drivers and included “lots of creativity and compromise.”

“This bill represents an historic opportunity to extend Washington state’s social safety net to drivers on our platform,” Hensley said.

Elvert Barnes photo via Creative Commons.

Ramona Prieto, Uber’s head of public policy for the Western U.S., echoed those thoughts in an emailed statement.

“This compromise bill gives drivers what they want — it protects the flexibility we know they deeply value while gaining historic benefits and protections,” Prieto said.

The Driver Resource Center is among the most important provisions to Peter Kuel, president of Drivers Union. The center establishes a system for resolving disputes between drivers and the companies, including an appeals process for drivers who have been “deactivated” or fired from a platform.

“You lose your job very easily,” said Kuel, a driver from Kent, Wash. who knows drivers who have been deactivated due to unfounded complaints.

Drivers might have purchased a new vehicle for the work or left other jobs, creating great hardship if suddenly deactivated. And once dropped from a platform, Kuel said, the drivers have few alternatives for recourse, leaving them depressed or even suicidal.

“Our demand was we need protection,” he said, and this bill provides it.

But not all unions and labor organizations support the legislation. Leaders from the nonprofit Drive Forward Seattle and from Massachusetts AFL-CIO testified against the bill. Some who oppose the legislation are concerned that drivers have lost their ability to fight for employee status, which could offer better benefits. There are fears that the approval process has been too hasty and that the bill’s ramifications have not been fully considered.

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“HB 2076 and the bills we are seeing introduced all over the country are just the beginning,” said Steven Tolman, president of Massachusetts AFL-CIO in his testimony to Washington lawmakers.

“If these bills legally validating Big Tech’s exploitative labor practices get passed, all types of industries will move to an app-based workforce because there is an established precedent of exemptions from wage and hour laws, anti-harassment and civil rights protections, taxes, Social Security and liability insurance,” Tolman added.

“Our demand was we need protection.”

“This bill requires too much from the state, delivers too little for drivers, and increases transportation costs for my constituents who often rely on rideshare companies because of inadequate public transportation options,” Democratic Rep. Debra Entenman told the New York Times.

Seattle has been a leader in pushing for drivers’ rights. In 2020, the city approved a bill creating a minimum wage for ride-hail drivers. The move was opposed by Uber and Lyft, the latter warning ominously that the rules would push the companies out of the city.

The statewide bill would allow existing local rules — namely those in Seattle — to remain in place. But it prohibits updates or new city or county rules.

Other states and cities nationwide have likewise wrestled with efforts to regulate the gig industry.

In 2019, California approved a law that classified gig drivers as employees of the companies, which caused gig companies to heavily fund a 2020 ballot measure overturning the move. That effort is still being fought in court.

In Massachusetts, gig-worker companies are spending millions of dollars on a similar ballot measure that codifies the status of drivers and other gig workers as independent contractors, not employees. The measure could go to voters in November.

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More than a dozen states including Michigan, Texas, Florida and Alaska have regulations defining independent contractors in certain contexts.

In December 2021, news broke that some of the biggest players in the Washington’s gig economy — Uber, Lyft, Instacart and DoorDash — had formed an industry group called Washington Coalition for Independent Work. It appeared that the effort was created in pursuit of an initiative or legislation affecting the sector.

The state bill under consideration only addresses ride-hail companies. So what about delivery platforms and other gig workers? Will they get their own legislation?

“I would want to hear from workers in those areas,” Berry said, and learn of their specific concerns. “I’m open to working with them.”

Editor’s note: This story was updated to include testimony from the Massachusetts AFL-CIO and correct information about the Driver Resource Center.

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