Seattle lawmakers pass policy setting minimum wage and other protections for gig workers

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Supporters of the PayUp policy addressing gig workers demonstrated outside of Seattle’s City Hall, providing an illustration of how much was earned for deliveries. (Working Washington Photo)

Seattle City Council on Tuesday unanimously passed what is being called a “first-in-the-nation” policy to create protections for gig workers who deliver meals, groceries and packages, and some on-demand service providers.

The policy would:

  • Set a minimum wage that accounts for expenses incurred by workers; tips come on top of the wage
  • Create transparency for app-based companies, requiring them to share information up-front regarding pay, tips, and details of each job
  • Prevent companies from penalizing workers based on the shifts and jobs that they accept

The policy, which has been dubbed PayUp, excludes Seattle-based Rover, a pet-sitting and walking service, and freelance-labor app TaskRabbit. The council voted to continue working on policies to address those services.

The measure now goes to Mayor Bruce Harrell, plans to sign the bill.

“Gig workers deserve a fair shake and a fair wage. We’re committed to making Seattle an affordable city where workers can thrive,” Harrell said by email.

Before the vote, council member Lisa Herbold, one of the sponsors of the policy, said that the gig-economy, app-based jobs were often filled by members of the BIPOC community and immigrants who are exploited by the roles. An estimated 40,000 people perform gig-worker jobs in Seattle, she said.

“Companies can get away with offering poor quality, unsafe jobs where workers have virtually zero legal protections on the job because for so many workers, there is simply no alternative,” Herbold said. “Far from offering economic opportunity, this business model deepens the desperation of underpaid Black, Latinx and other workers of color who have been shunted to the bottom of the economy.”

During a public comment period preceding the vote, gig-economy workers called in to testify for and against the policy. One worker in favor said the job didn’t pay enough to cover her bills. Another in opposition said their family risked homelessness were it not for gig work and its flexible scheduling. A workers’ organization called Working Washington has been campaigning for the policy.

Delivery companies including Instacart, DoorDash and Shipt lobbied against the measure.

“This is a policy in search of a problem,” said Anna Powell, Northwest government relations manager for DoorDash, during public testimony.

The company recently ran ads on the Seattle Times’ website, cautioning that the proposed rules would lead to higher costs for customers, create in fewer opportunities for gig workers and result in lost business for restaurants.

During the public comments, many of those opposed to the measure called for additional research and more consideration of the issue. Herbold noted that there had been a stakeholder process and that the package had been discussed six times in council committees since July 2021.

One of the key points of dispute is how much the gig workers are earning for their labor.

Working Washington this month released a report generated from crowdsourced job reports from 400 workers. It found that they earn $9.58/hour on average after expenses and before tips. Even with tips, about half of gig jobs yielded net earnings below minimum wage.

The industry-funded driver group Drive Forward also performed a survey of 800 Seattle delivery app workers in February 2021. Drivers’ gross pre-tip earnings in that survey ranged from $15.39 to $27.18/hour, and tip earnings ranged from $11 to $28/hour. After subtracting expenses of $0.34/mile “many would fall below an equivalent to Seattle’s minimum wage,” the report concluded. Part-time drivers earned more, possibly because they timed work for peak hours.

Leaders in Seattle and Washington lawmakers have in recent years been proposing and approving policy to start regulating the gig-economy sector.

In 2020, Seattle passed legislation extending paid sick leave to gig workers. During the pandemic, the city also approved legislation temporarily requiring food delivery companies to pay drivers $2.50 per delivery on top of their regular rates.

In March, Washington state legislators approved legislation that sets a minimum wage and other benefits for Lyft and Uber drivers. Gov. Jay Inslee vetoed a portion of the bill before signing it into law this spring.

Editor’s note: Story has been updated to add a comment from Mayor Bruce Harrell.

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