Seattle seeks to raise pay and set labor standards for gig workers

After months of stakeholder meetings, the Seattle City Council is introducing a series of policies establishing app-based labor standards, called the "Pay Up" ordinance.

The legislation is sponsored by Councilmembers Lisa Herbold and Andrew Lewis and is aimed at raising pay and providing basic worker protections.

Many app-based drivers say the current pay rate doesn’t take into account the amount of time it takes to get the job done. Carmen Figueroa, a gig worker with Grubhub, recalls what she earned at a recent gig — a short, two-hour shift.

“Just made $28 and some odd cents,” she said, adding that this is not a living wage.

One of the orders Figueroa completed was from a fast food drive-thru where she sat in the the drive-thru line for 45 minutes.

“It’s not worth my time or effort or gas or patience,” Figueroa said. “I only took that order to maintain my rating; did not want it, did not want to deliver it.”

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Under the city’s proposal, workers would receive minimum payment for what it calls “engaged time,” and “engaged miles.” That means when Figueroa accepts an order, the clock starts. Engaged time includes the time it takes to provide the service — from driving to the restaurant, waiting for the order, to delivering the food.

In Seattle, it’s estimated there are 40,000 gig workers like Figueroa. She started gig work four years ago after a back injury. It’s become her main source of income.

“I’m too disabled to work full time, or part time,” Figueroa said. “Gig work is the only industry that allows me the flexibility to set my own work hours while working at a pace and intensity that I am physically comfortable with.”

Ever since the gig economy boomed, 16% of Americans have earned money via online gig work, according to a 2021 study by Pew Research Center. Many are adults under 30, and Hispanic adults.

Critics say Seattle’s proposal would hurt businesses with increased cost of deliveries, and it would hurt consumers who rely on the service.

In a statement, an Uber spokesperson says the policy being pushed through will result in less work opportunities for drivers, increased costs for customers and fewer orders for small businesses that access these online platforms.

Seattle Councilmember Sara Nelson says she supports a living wage for drivers, but worries about the proposal’s unintended consequences.

“We know that in New York City and Seattle, after those cities imposed a higher fee for rideshare drivers, demand plummeted and their flexibility was hampered and that impacted their income,” Nelson said.

In 2019, Seattle passed a similar law, the Fare Share Wage ordinance, specifically for Uber and Lyft drivers. Nelson says she wants to avoid those unintended consequences to other app-based drivers.

“Many of the impacts of this sweeping 60-page legislation will not even be known until after the legislation is passed,” Nelson said. “And that’s because much of the detail about its implementation will be figured out by the Office of Labor Standards afterwards.”

Nelson says she’d rather the city take the time to study all the potential impacts before passing legislation. The City Council will begin discussion on the bill when the Public Safety and Human Services Committee meets April 12.