New minimum wage: Uber, Lyft’s exit leaves 10,000 workers jobless in Minneapolis

Uber Technologies Inc. and Lyft Inc. have announced their decision to halt operations in Minneapolis effective May 1, following the City Council’s decision to implement a local minimum wage mandate of $15.57 per hour for rideshare drivers. This move comes after the City Council overturned Mayor Jacob Frey’s veto on the matter.

Expressing disappointment, Uber stated, “We are disappointed the Council chose to ignore the data and kick Uber out of the Twin Cities, putting 10,000 people out of work and leaving many stranded.”

Lyft, taking the same side, termed the bill as “deeply flawed” and hinted at the possibility of returning if a more favorable statewide solution is reached in Minnesota.

The decision has stirred controversy among rideshare users and the companies alike. Lyft, in communication with its customers, conveyed, “We’re leaving Minneapolis. Despite our efforts and your support, the Minneapolis City Council passed an ordinance that would make rides on the Lyft platform unaffordable for the majority of Minneapolis residents.”

This development follows protests staged by rideshare and delivery drivers on Valentine’s Day, advocating for fair pay and better working conditions. The situation in Minneapolis adds to the ongoing national discourse surrounding gig worker rights and equitable compensation.

The rideshare companies’ departure from Minneapolis also comes in the wake of significant legal proceedings. In November, Uber agreed to a $290 million settlement and Lyft to a $38 million settlement to resolve a multi-year investigation by the New York Attorney General’s office into wage theft, marking the largest settlement of its kind in the office’s history.

The decision by Uber and Lyft to leave Minneapolis underscores the complexities surrounding labor regulations and gig economy dynamics, leaving both workers and consumers impacted by the fallout.

Read more on User data: Uber denies breach, defends compliance in Lagos State amid threats of sanctions