Seattle becomes first U.S. city to let Uber drivers unionize

Seattle on Monday became the first U.S. city to allow drivers of ride-hailing companies such as Uber and Lyft to unionize over pay and working conditions, a decision that will almost certainly be challenged in court and has already met resistance from the city's mayor.

The city council's vote was unanimous at 8-0. Seattle Mayor Ed Murray said late Monday he does not plan to sign the bill, though it can still become law without his signature.

Under the new ordinance, companies would be required to give the city a list of its Seattle drivers. A nonprofit organization like a union would use the list to contact drivers and work to gain the support of a majority of a company’s drivers to be designated as their bargaining representative.

Uber and Lyft strongly opposed the ordinance and were expected to challenge it in court. David Plouffe, a former political strategist for President Obama who now serves as an adviser to Uber, visited Seattle earlier this month to promote the company and criticize the ordinance, The Seattle Times reported.

The company has also sued King County and the Seattle law firm Keller Rohrback in an attempt to block the county from releasing the number of licensed drivers the company has citywide.

Jessica Santillo, an Uber spokesperson, said the company "is creating new opportunities for many people to earn a better living on their own time and their own terms." She noted that half 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 week-to-week.

Lyft spokeswoman Paige Thelen said the ordinance "threatens the privacy of drivers, imposes substantial costs on passengers and the city and conflicts with longstanding federal law."

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John Kirkwood, a professor of antitrust law at Seattle University’s law school, told USA TODAY the city council may have overstepped itself in Monday's vote. Only states, not cities, are allowed to “replace market competition with state regulation,” by allowing collective bargaining, he said.

The attempt to allow Uber and Lyft drivers to unionize would violate antitrust laws unless it satisfied that state action exemption, he said.

He also said states that have allowed collective bargaining are required to supervise both the process of that bargaining and the results. The Seattle ordinance includes language covering the bargaining process, but not the outcomes. There’s nothing in the ordinance about oversight of the possible impacts union bargaining might have on the general public, such as higher prices, Kirkwood said.

“That’s required,” he said.

Mayor Murray cited these concerns in an online statement after the vote. The ordinance includes "several flaws, especially related to the relatively unknown costs of administering the collective bargaining process and the burden of significant rulemaking the Council has placed on City staff," he wrote. "I said consistently during this debate that I support the right of workers to organize to create a fair and just workplace."

Seattle has led several U.S. cities on workers’ rights issues, such as gradually raising the minimum wage to $15 and requiring most employers to provide paid sick leave. Council member Mike O’Brien, who introduced the bill, said Monday's vote was the next step in economic justice for workers.

Many drivers in Seattle are immigrants who depend on full-time work, but some make less than minimum wage and lack basic worker rights such as sick leave and protection from retaliation, he said. Labor activists have complained that app-based services such as Uber and Lyft make it easier for companies to contract with independent workers and avoid paying minimum wages and benefits.

O’Brien’s proposal grew from organizing by taxi, Uber and Lyft drivers in Seattle and from advocacy by Teamsters Local 117, The Times reported. Some Uber and Lyft drivers have said that after expenses they make far less than the city’s minimum wage. While others have said they like the system as it works, at least 1,000 drivers have already organized as part of the App-Based Drivers Association, Reuters reported. Many have said they struggle to make a living, with some earning less than $3 per hour after expenses.

On its website, the association said drivers for companies like Uber and Lyft "have no say over their working conditions" and are "routinely and arbitrarily disconnected from their apps without warning or explanation." It also said driver pay has dropped radically as competitors slash their pricing in an effort to undercut competition. "Drivers make huge investments in their businesses but have no job security and no place to voice their concerns," it said.

In a statement, Teamsters Local Union 117 celebrated the vote, calling it "a turning point toward greater protections for workers in a changing economic landscape."

“By giving us rights, this law will help all of the drivers and also help our communities,” said Peter Kuel, an Uber driver and member of the leadership council of the App-Based Drivers Association.

Uber operates in more than 300 cities in 67 countries and has raised more than $10 billion from investors. Its war chest has helped fund legal and regulatory battles worldwide, as well as lobbying efforts at state and national levels.

Contributing: The Associated Press.