By Erica C. Barnett

The Seattle City Council is fast-tracking a repeal, sponsored by Council President Sara Nelson, of the city’s minimum wage for “gig” delivery drivers after companies like Doordash, Instacart, and Uber imposed a $5 fee on every order—essentially crashing their own Seattle market—and said they would not remove the fee unless the city reduced driver wages to the citywide minimum, currently $19.97. Under the current law, known as PayUp, drivers average about $26 an hour before adding tips and subtracting expenses.

Under Nelson’s proposal, the companies would be required to pay the city minimum wage,  plus 35 cents a mile for mileage—less than half the federal rate workers can claim on their income taxes. (Nelson said the lower rate made sense because people in Seattle tend to drive smaller-than-average cars, without noting that they also pay higher-than-average rates for gas.)

Because Nelson’s bill would allow companies to average workers’ pay out over two weeks (and remove a $5 per order minimum), workers could actually earn less than minimum wage but be paid the minimum once companies “trued up” their wages on payday. Workers would also have to pay $5 to withdraw their wages before the end of each two-week pay period, despite the fact that they are not technically employees of the companies that employ them.

The PayUp legislation, passed in 2022 and implemented last year, requires app companies to pay higher mileage and per-mile rates than Nelson’s proposal; it also required them to pay for costs they previously passed on to drivers, such as the employer half of income taxes and state unemployment, family and medical leave, and workers’ comp insurance. Nelson’s bill would allow companies to once again pass these costs along to drivers.

Nelson introduced her bill in her Governance, Accountability, and Economic Development Committee on Thursday. She said she felt a “moral obligation” to move quickly on the bill because drivers and restaurants are no longer getting enough orders to make a living, now that the companies’ high fees are driving customers away. “The impacts are quite real,” she said. Nelson then blamed the city’s own Office of Labor Standards for asking the companies for more data and putting “the focus… on the network companies” to demonstrate why they need the law to change.

“I am a pragmatist,” Nelson said. “I don’t want to wait for months, because people can’t pay rent rent right now. And so that is why I am motivated to do something that will have an immediate impact. And this first-in-the nation legislation is what caused the chain of events that we’re experiencing now.”

“Some would say,” Nelson added later, “some have argued, that it sets the highest city-established minimum wage for app-based workers so far in the country.”

But drivers (those not affiliated with the Uber-backed group DriveForward, at least), along with other labor advocates, poked holes in that argument.

Kyle Graham, who has driven for Uber and UberEats since 2016, said that after the city removed a temporary COVID-era pay increase for delivery drivers and other essential workers, his pay dwindled to as little as $3 an order, before tips—and a lot of people no longer tip. “This $5 they added [to each order] is just to try to get customers and drivers to fight in these council chambers for Uber, because they think that if they get rid of this ordinance, they’re going to drop those fees,” Graham said, but Nelson’s proposal does not remove the fees. “But orders are coming back [with the new fees], and if they’re getting just as many orders, they’re to going to drop that fee.”

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Once he pays for gas, maintenance, and all the other expenses Uber would have to pay if he was an employee, Graham said, it sometimes “just isn’t worth it” to keep driving. “The people who are still driving are the people who are the most exploited or can’t find anything else.”

In addition to lowering drivers’ wages, Nelson’s proposal would bar workers from filing lawsuits against the app companies; strip the city’s Office of Labor Standards’ power to ask the companies for information or impose any new restrictions on the companies in the future; and remove transparency requirements.

It would also remove restrictions that currently prevent companies from retaliating against drivers when they behave in ways the companies don’t like, such as declining to be on the apps during hours of high demand.

At times, it seemed as though Nelson and other council members were not aware of the details of the legislation they’re preparing to pass. For example, she denied that the legislation removes protections against retaliation, and said “any claim to the contrary is just plain confusing to me.” In fact, the law enacted last year prohibits companies from taking retaliatory “adverse actions” against employees and spells out examples of such actions in lengthy detail; Nelson’s legislation explicitly eliminates all of these protections.

Other council members took pains to establish that workers’ minimum wage was on top of tips, implying that the app companies are being more generous than required. In fact, state law bans employers from taking a “tip credit”—paying less than minimum wage as long as workers’ total wages plus tips work out to minimum—so the apps couldn’t count tips toward wages even if the council wanted to allow them.

The legislation will get another committee hearing, and could be amended (Councilmember Rob Saka, for instance, asked a couple of pointed questions about the provision removing workers’ private right of action) before it goes to the full council for approval.