Uber has been a growing company for some time. However, there has been no real unity in the company it seems. Well, Uber drivers in Seattle, Washington may have the option to unionize if they want to.
On Monday, the city of Seattle passed a law that would make it possible for Uber Lyft drivers to form labor unions. This may greatly alter the labor model for the company (where most of its employees make their own schedules). Seattle City Council passed the bill (with an 8-0 vote), however, the city’s mayor still has to sign it for it to pass in full. In addition to waiting for the approval of the mayor, the bill will likely be held up in court by Uber and other companies which will hold it up for some time (and maybe kill it).
As independent contractors, Uber and Lyft drivers cover the cost of driving Uber customers around. Each employee provides their own car, pays for their own gas and has to pay for any repairs on their vehicles. The company calls its employees “partners.” Each person that drive for Uber is able to make their own schedule. Most of the company’s “partners” are completely content with the setup. There are a few, however, that support the idea of a union.
“Uber is creating new opportunities for many people to earn a better living on their own time and their own terms,” an Uber spokeswoman said. “Drivers say that with flexible and independent work with Uber, 50% of them drive fewer than 10 hours a week, 70% have full-time or part-time work outside of Uber and 65% choose to vary the hours they drive 25% week-to-week.”
Seattle Councilmember Mike O’Brien, who rallied for the bill, said that Uber is “a race to the bottom.” In addition to O’Brien’s comments, Tom Rasmussen, another fellow councilman, said the lawsuits that are expected to ensue are “the cost of seeking innovative policies.”
This “innovative policy” may affect the company’s core though. Uber and Lyft are companies that are considered to be a part of the “gig” economy. Each of the drivers for the company are considered independent contractors and, under federal law, independently contracted employees do not have the right to band together in an union. Seattle’s City Council does not think this is fair though.
Because Uber has grown so much within the past few years, Seattle’s council members decided to step in and try to set up a collective bargaining system for the drivers. Under the bill passed on Monday, Uber drivers will be able to seek out “exclusive driver representatives.” If enough of the drivers in the city banded together, by law, the company would then have to communicate through a union within the city.
Beyond Uber and Lyft, taxi drivers within the city of Seattle are often considered to be independent contractors as well. Taxi drivers may also be affected by the new bill. However, whether the law is going to go into effect is yet to be seen.
Uber, Lyft and many other for-hire companies within the city of Seattle are expected to challenge the bill in court. The companies will likely argue that the bill conflicts with federal labor law. They may also argue that it runs afoul of antitrust law.
Whether the bill withstands in the courts or not, there is one clear takeaway. The action by Seattle’s City Council marks the first attempt by a government body to address Uber’s business and labor model. It also brings up a curious question – How independent are independent contractors?