Gov. Walz issues first veto after rideshare companies push back on proposed bill

Uber officials say cost of rides would increase by 50% at minimum
Published: May. 25, 2023 at 3:11 PM CDT|Updated: May. 25, 2023 at 4:18 PM CDT
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4:15 P.M. UPDATE: After pushback from rideshare companies, Governor Walz vetoed the proposed bill for wage changes.

On Thursday, Walz issued an executive order to commission a study and convene a working group of drivers, riders, rideshare companies, members of the disability community, and labor to issue recommendations for rideshare legislation next year.

“Rideshare drivers deserve fair wages and safe working conditions. I am committed to finding solutions that balance the interests of all parties, including drivers and riders,” said Governor Walz. “This is not the right bill to achieve these goals. I have spent my career fighting for workers, and I will continue to work with drivers, riders, and rideshare companies to address the concerns that this bill sought to address.”

Lyft spokespeople released a statement following the governor’s veto:

“We appreciate Gov. Walz listening to many in the community, vetoing the bill and instead creating a task force to properly study these important issues. Lawmakers should pass fair pay and other protections, but it must be done in a way that doesn’t jeopardize the affordability and safety of those who rely on the service. We recently did this in Washington state, where drivers, labor leaders, elected officials and the companies came together to pass smart legislation that benefited all involved. We look forward to continuing our engagement and finding a similar pathway forward here in Minnesota.”

The executive order also required the Department of Labor and Industry to commission a study to obtain and analyze data related to the working conditions of rideshare drivers in Minnesota and how potential changes may impact access and cost for riders.

This is Governor Walz’s first veto as governor of Minnesota.

DULUTH, MN. (Northern News Now) - The future of Uber in Minnesota is now uncertain after company officials spoke out Thursday.

Uber officials have stated if Governor Walz signs this bill they will stop ride services outside of the Minneapolis-St. Paul metro area.

“Following several months of unanswered requests to work with legislators on comprehensive legislation that provides flexibility and benefits to drivers without compromising service for riders, we are left with a bill that will make it impossible to continue serving most areas of the state. If the bill is signed into law, beginning August 1, Uber will stop operating our rides service outside of the Minneapolis-St. Paul metro area. In the metro area, we will only offer premium products to match the premium prices required by the bill,” says Freddi Goldstein, Uber spokeswoman.

The Minnesota Uber/Lyft Drivers Association has been fighting for wage increases, better insurance coverage, and protections against getting fired, along with minimum rates.

A proposal in the Minnesota legislature, meant to protect workers for rideshare companies like Uber and Lift, actually threatens how much drivers earn say the two companies.

The bill sets new minimum wage payment rates to increase the driver’s final tab.

It would require compensation of at least $1.45 per mile and 34 cents per minute for rides in the seven-county Twin Cities metro area, with a 20-cent decrease in the mileage rate elsewhere in the state.

Uber officials say after market analysis the cost of rides will increase by 50% at minimum with the bill.

As a result, it is expected to drop the demand for trips by 30%, which will cause thousands of drivers to be without work.

Uber projects drivers will make more on each trip, but since they will have fewer trips requested over time they will earn much less.

It is estimated there will be at least a 10% decrease in aggregate earnings for drivers who remain on the platform.

Uber says with the proposed bill, drivers in Minneapolis would be paid more per mile than anywhere else in the country.

Uber leaders offered a compromise to the bill of $1.17 per mile and 34 cents per minute, occupational accident insurance coverage, and codifying independent contractor status.

However, they say this was ignored.

“The bill makes rides less safe, a risk we cannot take, by putting the burden of proof on the victim, forcing us to either have victims of sexual assault testify publicly or let the driver back on the platform,” say officials.

This is a developing story. Check back for updates.

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