Seattle Approves 'Unprecedented' Unionizing Ordinance For Taxi And Ride-App Drivers

Dec 14, 2015

UPDATE: In its meeting Monday, the Seattle City Council voted 8-0 to approve a measure that allows drivers for ride-hailing companies to unionize.

Seattle’s City Council will take up an ordinance on Monday that lawyers say is unprecedented. The council is scheduled to vote on whether to allow drivers for ride-hailing companies such as Uber to form unions and collectively bargain for better pay. 

Companies such as Uber and Lyft say the drivers are independent contractors because they choose how much and when to work, flexibility that a top Uber executive said the drivers value. The drivers also provide their own cars and pay their own expenses.

Seattle City Councilmember Mike O’Brien said he’s concerned that designation leaves the workers without a safety net.

"When Uber classifies their drivers as independent contractors, they make them exempt from minimum wage, paid sick leave, Social Security – all the types of protections that we have in place," O'Brien said. 

He said he's concerned that Uber and Lyft have dropped their prices for rides so low that they’ve made it difficult for any of the drivers to earn a living, whether they operate traditional cabs or drive their own vehicles for the ride-app companies.

`Path To The Middle Class'

So he’s proposing a city ordinance to let these independent contractors do something they’ve never been able to do under federal law – form a union.

"We were trying to figure out, how do we restore a job that creates a path to the middle class for some of these immigrant and refugee drivers or anyone who chooses to drive?" O'Brien said. "And the idea is, can we give them the power to negotiate the terms of their employment or some power to do that?"

Seattle University law professor Charlotte Garden said this approach is similar to Washington state laws extending collective bargaining rights to groups that have been excluded from the federal law, such as agricultural workers and public-sector employees.

“States have kind of reached out and said, `We think it's important for these groups of workers to be able to bargain collectively and so we're going to step in where federal law has excluded them,'” Garden said. 

Legal Hurdles

Still, Garden said a court challenge is a virtual certainty - a view shared by other lawyers. 

"I think what they’re trying to do will ultimately be found illegal," said Todd Lyon, a partner with the employment law firm Fisher and Phillips.

He said one problem with the proposal is that federal antitrust law prohibits independent contractors from banding together to set prices.

"The ordinance is basically having these independent contractors engage in what’s called price fixing," Lyon said. 

O’Brien said he hopes companies won't challenge the ordinance if it passes, but he acknowledged that this is something that hasn’t been tried before. He said other cities, including New York, are paying attention.