New proposal could lower delivery driver minimum wage law in Seattle

Delivery driver minimum wage law controversy

A new proposal in City Council could mean a change in a law for gig workers in Seattle.

SEATTLE - Seattle City Council is considering a proposed ordinance related to app-based worker labor standards that advocates say would harm gig workers in Seattle.

CB 120775 would revise major parts of the PayUp bill passed by the previous Seattle City Council in May 2022.

The original PayUp bill guarantees a minimum wage for gig workers.

The new proposal would pay gig workers based on an hourly rate when making deliveries to keep the wage at $19.97, which is Seattle's mandated minimum wage, as well as add a per-mile minimum of $0.35.

Advocates of the original PayUp bill say when you consider payroll taxes and other fees that gig workers have to deal with, CB 120775 misses the mark for meeting the minimum wage.

"At the end of the day, this proposal is to return this industry to sub-minimum wages, which is why we oppose it," said Danielle Alvarado, Executive Director of Working Washington.

Alvarado blamed customer fees that app-based delivery companies tacked onto customers as soon as the PayUp bill started in January. In Thursday's Committee meeting, Seattle City Council President Sara Nelson also pointed the finger at customer fees.

"The fee has to go away because no one is disputing that was a catalyst to this," said Councilmember Nelson.

Councilmember Nelson cited data from Drive Forward, saying the customer fees have reduced customer demand, hurting income for drivers and restaurants in Seattle.

In the past 3 months, DoorDash says there has been an estimated 300,000 fewer orders made in Seattle.

The company sent us this statement:

"It’s painfully clear from listening to Dashers, merchants and consumers that this new law simply isn’t working. The latest numbers show that the longer this law remains in place, the more harm it causes. The compromise proposal presented by Drive Forward that the City Council is considering is a promising step toward increasing affordability for consumers and restoring millions in lost revenue for merchants and Dashers in Seattle."

However, Alvarado says companies like DoorDash need to share data, especially when it comes to customer fees and that data from Drive Forward is coming from a group founded and funded by Uber.

"So, that tells us it's an industry-drafted policy which didn't include so many other stakeholders," said Alvarado.

Alvarado wants to see data when it comes to customer fees.

"We feel like data really should be provided to explain why those fees have been imposed on customers," said Alvarado. "What is the impact of those fees on workers? All of that, we think, should be explored."

Alvarado says CB 120775 also lacks transparency. As listed here, this proposed ordinance would "Eliminate OLS’s ability to require affirmative records production from companies for purposes of administration, evaluation, and enforcement."

If CB 120775 passes, its impacts could spill beyond the gig worker economy.

"If we have parts of our economy where they say all bets are off, there are no expectations with how businesses treat workers, that's something that will never stay to one segment," said Alvarado.

While amendments could be made to CB 120775, a vote on this proposed ordinance could come as early as May 21.

We reached out to Seattle City Council, but a spokesperson said members were not available for interviews on Thursday.