Seattle City Councilmember Mike O’Brien says he has a plan to strengthen the collective bargaining power of drivers who work for companies like Uber, Sidecar and Lyft. His effort comes amid a growing complaints nationwide about ride-hailing services’ paltry wages. But to succeed, he’ll have to take on national labor laws that do not traditionally grant collective bargaining rights to contractors.
O’Brien made his announcement Monday at City Hall, flanked by a cast of drivers, many of whom quit low-paying jobs to drive for Uber. He told the story of a man left behind a minimum wage job, only to find himself earning even less as a driver. “It was not a story of increased income and opportunity, but the opposite” said O’Brien. “After filing his tax return, he found he was making around $3 an hour.”
One after another, the drivers told stories of making far less than they’d expected, thanks mostly to the costs of purchasing a car, maintenance, insurance and taxes. “The owners of the company have taken advantage of the drivers,” said one driver named Faseel. “It’s not fair.”
Uber’s model of ridesharing may be innovative, O’Brien said, but there’s nothing innovative about building an economy on the backs of workers.
Uber representatives would not comment directly on the ordinance O’Brien plans to introduce next week, saying that they had not had a chance to review it. “Uber is an important contributor to the local economy in Seattle, helping to create new opportunities for many people to earn a better living," said an Uber spokesperson in an e-mail.
Uber and other ride-hailing companies have achieved remarkable success in recent years by expertly living just beyond the reach of regulation. Their critics, including traditional taxicab companies, argue that they are nothing more than unlicensed and uninsured taxi services. Some cities have gone so far as to outlaw them.
Seattle and Washington State have taken a more moderate approach. In 2014, when several taxi companies sued the City of Seattle for allowing the ride-hailing companies to operate, Mayor Ed Murray managed to strike a deal between the app-based companies and the taxi drivers, placing caps on the number of drivers and giving certain priorities to more traditional taxis. While taxi-driver complaints have continued, the legal battles quieted.
Last May, Gov. Jay Inslee signed a bill sponsored by Senators Cyrus Habib and Joe Fain that created a stricter insurance framework for app-based drivers, requiring liability minimums and per-passenger insurance coverage. For the most part, the effort was applauded from both sides.
But stories about low wages and poor treatment of divers have spurred a nationwide debate about whether app-based drivers can or should be considered contract employees at all, or direct employees. One case in California last June ruled that one Uber driver was in fact an employee. The ruling was very specific to one driver, but if the principle can be brought to bear on all of them, ride-haling companies will have to abide all standard labor laws -- minimum wage, for one.
O’Brien, for his part, is taking a bit of a roundabout approach in an attempt to create a more direct line back to the companies. Under his proposed legislation, the City of Seattle would certify non-profit organizations as eligible to represent drivers. These organizations would receive a list of all the drivers in the city that have performed a minimum number of trips and will have 120 days to show that a majority of these employees want to be represented. When verified, the non-profit will speak on behalf of the employees.
Because the Seattle City Council is on recess, it’s hard to say how many councilmembers would get behind O’Brien’s ordinance. If the legislation does pass, however, the city would likely face a lawsuit. "We know these companies are not afraid to play hardball," said O'Brien.
The question, it seems, boils down to whether the National Labor Relations Act (NRLA) explicitly excludes contract employees from collective bargaining rights or if the act is simply silent on the issue. O’Brien said his interpretation is that the city is within its legal authority to pass this ordinance. “I feel really good about our chances if this goes to the courts,” he said.
It is possible, however, that the courts could strike down the city's ordinance for trying to go above what the NRLA allows a city to do. Giving contractors collective bargaining rights is relatively uncharted territory, according to Rachel Smith, deputy director of the National Employment Law Project. The closest examples she could think of were farm workers and public employees, but she wasn’t sure what, if any, precedent has been set for drivers.
In addition to an uncertain fate in court, it's unclear how O’Brien’s legislation would relate to other companies that use contractors -- take the Port of Seattle, for example, which employs contract truckers.
If the ordinance moved flawlessly through committee, the City Council could pass it by the end of September. If it gets hung up in committee, it could run into budget negotiations and see delays into late fall and winter.