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Uber, Lyft will cease operations in Minneapolis over minimum wage legislation

A sign identifies a meeting point for Lyft and Uber passengers at San Diego State University in San Diego, California, U.S., May 13, 2020

March 15 (mod1s) - Uber Technologies (UBER.N), opens new tab and Lyft announced on Friday they would suspend operations in Minneapolis beginning May 1 after the city's council cleared the route for rideshare drivers to be paid a minimum wage. 

The council voted 10-3 to override Mayor Jacob Frey's veto, guaranteeing rideshare drivers in the city be paid $15.57 an hour. 

"We are disappointed the Council chose to ignore the data and kick Uber out of the Twin Cities, putting 10,000 people out of work and leaving many stranded," Uber stated.

Meanwhile, smaller competitor Lyft, calling the measure "deeply-flawed", said it intends to return to Minneapolis while it works for a statewide solution in Minnesota. 

This comes after ridesharing and delivery drivers held a protest on Valentine's Day this year seeking fair pay and working conditions. 

The New York Attorney General's office stated in November that Uber would pay $290 million and Lyft will pay $38 million to end a multi-year investigation against the businesses, calling it the biggest wage theft settlement in her agency's history.

A report, opens new tab by the Minnesota state's Department of Labor and Industry released last week stated the corporations are unlikely to boost prices to levels that would considerably affect customer demand and commissions, adding that such a scenario was implausible.


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