Uber, Doordash, and other gig workers in Seattle may be about to face a pay reckoning

Gig delivery workers in Seattle could get paid at a lower rate under proposed changes to the city’s new pay law. AP Photo/David Zalubowski

• Seattle’s city council is considering replacing its PayUp law for gig workers after just three months.
• Under the proposal, delivery workers would make well under the city’s minimum wage, per one estimate.
• The bill has the support of companies like Uber and DoorDash.

Since January, gig delivery workers in Seattle have been reaping the benefits of a local law mandating a certain pay level. Just months later, they could see their incomes cut under proposed revisions.

PayUp, which took effect in the city in January, requires DoorDash, Uber, Instacart, Grubhub, and other delivery apps to pay independent contractors the equivalent of the city’s $19.97 minimum wage — a rule that the app companies have opposed.

But CB 120775, a proposal introduced last month by Seattle City Council President Sara Nelson, would lower the minimum pay for drivers and roll back protections for workers, according to a draft of the legislation.

Under the proposal, gig workers would be paid an hourly rate of $19.97 for their time spent retrieving and delivering orders. While that seems consistent with Seattle’s minimum wage for employees, the gig workers covered by the PayUp law are only paid for “active time” spent working on orders — meaning that time spent trying to claim an order is uncompensated. They’re also responsible for their own costs, such as gas.

Those aspects of the job had led Seattle’s city council to create a system that pays workers based on the miles they drive and the minutes they spend on the job. PayUp also demands that no offer pays less than $5.

The latest proposal would do away with that $5 minimum and the per-minute payment. Instead, gig workers would get paid 35 cents per mile — down from the current 74 cents.

It would also eliminate or cut back other protections for gig workers in the city. For example, a PayUp rule giving workers two minutes to review an order before accepting it would shrink to 45 seconds.

The bill is scheduled for a committee vote on Thursday. If it passes, the proposal could face a vote by the full Council on May 21.

‘That makes a difference’

If that vote passes, the bill will result in a significant pay cut for gig workers, according to estimates released Monday by Working Washington, a group that advocated for PayUp. For example, a gig worker who spent five hours of active time and drove 32 miles would make $15.81 an hour — below the city’s minimum wage — after accounting for expenses, they calculated.

Hourly pay would be even lower — $13.17 — after accounting for the time that a gig worker would likely spend on the apps just to find and claim orders, according to the study.

Justin Taylor, who has delivered and driven for multiple apps in Seattle over the last four years, said his pay has increased by $100 a week on average since PayUp went into effect — even though he’s delivering fewer orders than he did before the law.

“That makes a difference,” he told BI. “It allowed me to do things like install new front brakes on my car.”

If the proposal before Seattle’s City Council becomes law, Taylor said, he’ll once again be reliant on customers’ tips to cover his expenses and make money working for services like DoorDash.

The delivery companies have made it clear that they oppose the changes that took effect in January. In emails and calls to action sent to gig workers, DoorDash, Instacart, Uber, and others have claimed that there are fewer orders for gig workers to claim.

Some shoppers for Instacart have also had to drive miles out of their way to deliver orders in Seattle’s suburbs as the company routed them to stores outside city limits.

Seattle City Council President Nelson did not respond to a request for an interview from Business Insider. In a hearing on the bill on April 25, Nelson said that she had worked with some of the delivery companies as well as Drive Forward, a group whose leadership includes multiple current and former employees for Uber and DoorDash, to draft the bill.

“I want to make sure that people realize this was an agreement that was forged between Drive Forward and the network companies,” she told the Council.

A DoorDash spokesperson told BI: “Predictably, Working Washington’s opposition to this proposal is not rooted in reality. The proposed law guarantees Dashers will earn nearly $20 per hour on delivery in addition to mileage and tips. We’re grateful that Council President Nelson and Drive Forward were able to reconvene stakeholders and reach a compromise that better serves Dashers, local businesses, and consumers in Seattle.”

A spokesperson for Instacart said the company “supports the pragmatic approach being taken by the new Seattle City Council as they balance the needs of workers, customers, and businesses across the city and reform the current version of PayUp legislation.”

“Uber supports the complete package, and believes it will go a long way to ease the operational burdens and costs experienced by customers throughout Seattle and reduce delivery times,” a spokesperson told BI.

But gig worker Taylor said he was dismayed that the delivery companies have had such a direct role in developing the bill that would replace PayUp.

“To me, it’s basically saying we’re allowing lobbyists to write our laws,” Taylor said.

Do you deliver food, groceries, or other items as a gig worker and have a story idea to share? Reach out to this reporter at [email protected]

If you enjoyed this story, be sure to follow Business Insider on Microsoft Start.