Seattle council committee approves new wage rules for gig workers

A Seattle City Council committee voted in favor of an overhaul to Seattle’s pay standards for app-based delivery drivers Thursday, the last hurdle before the full council considers rewriting the law that’s been in effect for not even six months.

If passed into law later this month, the changes would cut both the hourly and per-mile pay rates for drivers with companies like DoorDash, UberEats, Instacart and others. It would also change how pay is calculated, switching it from being tallied at the end of each trip to being added up at the end of each pay period. Some requirements placed on the company, including that they disclose the precise location of delivery orders, would be rolled back as well.

At the core of council President Sara Nelson’s bill is a belief — disputed by some — that a city law passed in 2022 guaranteeing pay minimums for each delivery is hurting restaurants and drivers more than it’s helping. Following its effective date of Jan. 13, some companies have layered on additional fees, making orders more expensive. Though the new bill does not require those fees be rolled back, the hope is it will spur the companies to do so willingly. A spokesperson for Instacart, for example, has said the company would repeal its fee if the law passes.  

“Underneath all this noise, for me it comes down to accountability and the council’s duty to examine the outcomes of our laws,” said Nelson. “And if they’re not working we have to fix them.”

Though Nelson has said she wasn’t trying to seed a political storm with her proposal, the fight over the wage law has spurred fierce lobbying efforts by the companies, an industry-affiliated drivers group, labor advocacy organizations, individual drivers and restaurant owners.

In surveys, drivers and restaurant workers have reported receiving fewer orders than before the law took effect, beyond the seasonal fluctuations they might expect. Some drivers say the higher pay balances out the decreased trips, while others have said the result is they’re making less money overall.

Some restaurants have also been outspoken about the law, saying it’s suppressing business.

Becky Yoshitani, who runs Hurry Curry restaurant, said she saw orders drop dramatically in January and worries about the long-term health of the city’s restaurant industry. She’d favor a full repeal, but supports Thursday’s bill. “Whether it’s enough or whether it’s too late, time will tell,” she said.  

Advocates in favor of the 2022 law, however, have accused the corporations of using it as cover to smuggle in higher fees as retaliation. They argue a repeal is premature without more study and data.

“To make a decision to revise or repeal based on these rushed proposals is a complete slap in the face to democracy,” driver Kyle Graham said in the public comment period of Thursday’s meeting.

The real impact of the law on the companies is impossible to calculate; the companies are fiercely protective of internal data and have declined to release evidence to back up its claims they’re being hurt. Companies like DoorDash and Instacart pushed for a full repeal of the law, but the council opted instead for a rewrite.

The companies have expressed support for the revisions to the law, which they negotiated with Nelson and the company-funded drivers group, Drive Forward.

Danielle Alvarado, executive director of Working Washington, a pro-labor organization that fought for the original law, said her organization is interested and willing and discussing changes, but said that opportunity has not come up.

“We can talk about how to adjust [the law],” she said, “but what we have right now is not a compromise.”

The bill would cut the pay rate guaranteed to drivers from 44 cents per minute, plus 74 cents per mile during orders, or a minimum of $5 per order to roughly 33 cents per minute and 35 cents per mile. In place of the $5 per trip minimum, companies would calculate hourly pay on a weekly basis, topping up drivers who earned less than $19.97 for each hour worked. The bill would also make it so drivers would not be paid for trips canceled by the customer.

The original bill limited drivers’ ability to sue the companies, despite the council’s nonpartisan analysts failing to find a nexus between that right and the cost of delivery. An amendment Thursday from Councilmember Rob Saka restored that private right of action.

The council also amended the bill to state that companies could not dock driver pay if they earned more than the city’s base minimum wage and returning power to the city’s Office of Labor Standards to request records from the companies.

Councilmembers Nelson, Saka, Bob Kettle and Maritza Rivera voted in favor of the law. Councilmember Joy Hollingsworth abstained, saying she wanted the bill to be “baked more” and urged the various competing parties to come together for a compromise solution.

The final vote is scheduled for May 21.