Uber, Seattle and U.S. Chamber end dispute over union law as city plans minimum wage for drivers

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The U.S. Chamber of Commerce, Uber, and the City of Seattle have agreed to walk away from a lengthy and complex legal battle over a law that would allow drivers to unionize.

A federal judge in Seattle dismissed the lawsuit, at the request of all parties, ending a once-heated battle that cooled down when the city embraced a new approach to driver protections.

The dispute dates back to 2015 when the Seattle City Council passed a pioneering law that authorized Uber and Lyft drivers to collectively bargain. The Chamber sued Seattle on behalf of Uber and Lyft, claiming the ordinance violated federal antitrust laws and preemption statutes.

The parties went back and forth in the ensuing years until Seattle Mayor Jenny Durkan changed the dynamics in late 2019. Her Fare Share program, which the Seattle City Council unanimously approved, will extend Seattle’s minimum wage to Uber and Lyft drivers and establish a Driver Resolution Center to arbitrate between drivers and the companies. The new benefits will take effect July 1.

The Fare Share program takes some of the wind out of the collective bargaining ordinance’s sails. Though Uber and Lyft took issue with some aspects of the Fare Share legislation, they are not fighting it.

“While Uber expressed concerns about some aspects of these new laws, following passage, Uber committed to supporting the City of Seattle on the implementation of these ordinances in an effort to achieve the underlying, shared goals of improving opportunities and protections for rideshare drivers,” Uber said in a statement.

The dismissal of the lawsuit doesn’t prevent the Chamber from taking up the issue again down the line, nor does it require any party to pay another’s legal fees, according to the news blog SCC Insight, which first reported the news.

It isn’t clear whether Uber and Lyft drivers will continue their efforts to unionize in Seattle, but the collective bargaining ordinance does not have the same power it did when originally written. In 2019, the Seattle City Council removed the provision of the law that allowed drivers to negotiate over wages, as a way to thwart the Chamber’s legal challenge.

The City of Seattle celebrated the lawsuit’s dismissal late last week in a statement and thanked transportation network companies (TNCs) for agreeing to get behind the Fare Share program. “The City will now focus on collective efforts with TNCs supporting the implementation of the Fare Share Plan to achieve our shared goals of improving opportunities and protections for TNC drivers,” the city said in the statement.

Uber has seen a 60% to 70% decline in bookings in Seattle in the past few days and is preparing for an “absolute lockdown/shutdown” according to CEO Dara Khosrowshahi. At the same time, he said the Uber Eats restaurant delivery business has been growing significantly in Seattle and other markets as restaurants follow state mandates to shut down normal operations and shift entirely to delivery and take-out.

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