Last week, the Seattle City Council unanimously passed a bill to ensure app-based delivery workers earn at least Seattle’s minimum wage of $17.27, among other protections. What sounds like a modest gain is actually an important achievement for labor, especially when considered in the broader gig-economy. As a result, advocates like Working Washington, which spearheaded the legislation in partnership with allies on the City Council, are still celebrating.
One week later, and we’re still celebrating this HUGE victory: Seattle gig workers across apps won landmark #PayUp protections to raise pay, protect flexibility, & provide transparency.— Working Washington (@workingwa) June 7, 2022
It’s the first law of its kind created by & for gig workers!https://t.co/ArfCb3fKD3
However, the passage of an amendment sponsored by Councilmember Alex Pedersen (District 4) in committee to exclude marketplace workers from the current protections was a source of disappointment for some. Councilmember Andrew Lewis (District 7), one of the bill’s sponsors, provided a swing vote in favor of the exclusion that has been a source of criticism among some app-based worker advocates.
“[Lewis] did undermine his own bill here in a relatively strange move that he said was to ‘take down the temperature on the issue,’ The Stranger’s Will Casey said in a recent appearance on the Hacks and Wonks podcast. “But that didn’t really seem to happen because advocates for the workers are very upset that that exemption was inserted last minute into the legislation.”
As Working Washington Campaign Director Safe Wilson put it: “If the plan was that excluding thousands of workers at the last minute would make everybody happy, it didn’t work.”
A report, Seattle’s App Gap, published in May by Working Washington details how marketplace apps like TaskRabbit, Handy, and Rover, engage in practices that drive down worker earnings such as providing “suggested” rates that fall below the minimum wage threshold once expenses and time costs associated with taking on independent contract work are taken into consideration. While workers have the option to set higher rates, pressure within the marketplace often keeps wages low. Additionally, some sites like Rover do not assign a floor rate for certain services, like dogwalking, which can result in workers offering hour long dog walks for as low as $10 per hour.
Pay reductions resulting from rescheduling a service, late arrivals, or early departures can also decrease worker earnings. In fact, the app-based company Handy has been investigated by the Seattle Office of Labor Standards for possible violations of the Seattle Domestic Worker’s Ordinance because of workers reporting earnings falling below minimum wage standards.
Councilmember Lisa Herbold (District 1), who cosponsored the bill with Lewis, expressed frustration at the exclusion of marketplace app workers, likening it to when U.S. New Deal legislation omitted farm and domestic workers from minimum wage requirements back in the 1930s; however, like her colleagues, Herbold ultimately voted in favor of the legislation, in large part because of the passage of an amendment ensuring that the Council would produce separate legislation for marketplace workers no later than August of 2023. While Councilmember Sara Nelson (At-Large) expressed reservations about the amendment, she ultimately voted to approve it, making Pedersen the lone holdout.
Pedersen has continued to contend that by setting their own rates, marketplace workers should not fall under the consideration of the law’s protections. However, he has not addressed issues related to practices like the absence of a wage floor or other conditions set within the apps that drive down wages.
Out of a fear that app-based delivery companies might turn to a marketplace model in order to shirk protections, the legislation expressly states that workers engaged in all delivery services are eligible for the rights and protections afforded by the law.
Nonetheless, the app-based companies that will be subject to the law may have time to figure out new methods by which to continue to game circumstances in their favor. The Pay Up legislation will not come into effect for 18 months, five months longer than was provided to ridehailing companies (known as Transportation Network Companies or TNCs in industry jargon) like Uber and Lyft so they could prepare for the implementation of Seattle’s Fare Share ordinance, which raised wages and standards for ridehailing drivers.
Beyond the commitment to explore future legislation for marketplace apps, the Council has also pledged to continue to review ways to improve conditions for app-based workers by pursuing legislation related to restroom access, policies to prevent discrimination, background checks, protection against unwarranted deactivation from apps, and finally the creation of a gig worker advisory board for the City of Seattle.
Seattle’s legislation is notable because it goes further than what other American cities, such as New York, have implemented in the effort to guarantee basic employment rights and protections to gig economy workers. However, even when viewed in a broader context, Seattle stands out. For instance, in May, the Canadian province of Ontario also passed a $15 minimum wage for app-based workers; however, unlike Seattle’s legislation which includes paid time for reviewing offers and completing administrative tasks, the Ontario legislation only takes into account “active hours.” As a result, some workers have already criticized the measure.
Left largely unregulated by American lawmakers, the gig economy has grown by leaps and bounds in recent years, and it appears that it will not be disappearing anytime soon.
Food delivery services have exploded during the pandemic as work-from-home has proliferated, the desire to eat in crowded restaurants has decreased, and the lockdown and in-door dining restrictions forced many restaurants to add delivery offerings to keep revenue flowing. But with their added importance, delivery apps also found increasing friction with restaurants. “Last year, after small businesses and customers around Seattle complained that delivery services were ‘price gouging’ during the pandemic, the city imposed a 15% cap on commission that third-party, app-based services can charge to deliver food,” Tan Vinh reported in the Seattle Times.
Before the final vote, Herbold expressed a desire to make that commission cap permanent, meaning should be on the Council’s roster in upcoming months.
In any case, by the time Seattle’s Pay Up legislation comes into effect in a year and a half, it will be interesting to see where the industry stands and what other new forms of legislation aimed at guaranteeing rights for workers will have come about both in the U.S. and other countries.
Natalie Bicknell Argerious (she/her) is a reporter and podcast host at The Urbanist. She previously served as managing editor. A passionate urban explorer since childhood, she loves learning how to make cities more inclusive, vibrant, and environmentally resilient. You can often find her wandering around Seattle's Central District and Capitol Hill with her dogs and cat. Email her at natalie [at] theurbanist [dot] org.