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Seattle Just Became the First City in the US to Allow Uber Drivers to Unionize

The Seattle City Council unanimously passed a law that allows drivers that work for Uber, Lyft, and other ride-sharing services to collectively bargain.

by Avi Asher-Schapiro
Dec 15 2015, 1:25am

Photo via Flickr

The Seattle City Council unanimously passed a law on Monday that allows ride-sharing drivers — like those who work for Uber and Lyft — to form a union. As the council announced its decision Monday afternoon, the room erupted in applause.

"We're trying to balance the playing field," Councilmember Mike O'Brien recently told the Seattle Times ahead of the vote. "We have this multibillion-dollar company trying to monopolize the taxi industry around the world, and then we have drivers making less than minimum wage."

Don Creery, a 62-year-old ride-share driver in Seattle, is precisely the type of worker O'Brien seemed to have in mind. Speaking to VICE News from inside the Council chamber on Monday, Creery recalled how he first began driving for Lyft in September 2013. Ferrying passengers around Seattle in his new Kia Soul, he was making $30-35 dollars an hour. In just 30 hours a week, he made a decent living. "But a part of me knew it was too good to be true," he said.

A few months later, Uber launched in Seattle, and he signed to drive the budget UberX service as well. "It was really good for a while," he recalled.

Then came the rate cuts.

In August, Uber cut its fares by 20 percent in Seattle, and Lyft slashed its rates nationwide that April. The two companies were locked in a battle for Seattle's ride-share market — and both were trying to kill the city's taxi industry. "For drivers it became a serious grind," Creery recalls, saying he had to work longer hours to earn the same paycheck as before. That February, Uber dropped its prices by another 15 percent, a move it later reversed.

Related: Taxi Companies Are Suing New York City for Letting Uber Kill Their Business

"I started to think to myself: Companies aren't gonna keep paying workers this much," he said. "And I realized that we were going to have to organize someday."

Creery wasn't the only Seattleite to go from being a satisfied ride-share booster to a disgruntled and overworked driver for Lyft and Uber. Over the past two years, he and other drivers in Seattle sought to unionize. With the help of the local Teamsters chapter, they formed the App-Based Drivers Association, a coalition of Uber, Lyft, and traditional taxi drivers pushing the City Council to allow drivers who use apps to collectively bargain with their employers. Creery is now on the group's leadership council.

"They want to throw the word 'share' around — come on guys, let's start sharing in the prosperity," he said.

The new law permits Seattle drivers who perform at least 150 trips every 30 days to select an "exclusive driver representative" who can negotiate directly with management on their behalf. It seeks to address a number of wide-ranging grievances from drivers in the city.They want more transparency in companies' "deactivation" policy, which allows Uber and Lyft to essentially "fire" drivers at will, and they want a say in their rates. But most of all, they hope for a way to make demands on the company as a group.

'They want to throw the word 'share' around — come on guys, let's start sharing in the prosperity.'

"We wanted to be able to sit down across the the table from the company, and have a conversation about improving things," said Daniel Ajema a former Uber driver who was part of the original group that decided to push for a union back in 2013. Ajema was studying law at the time, and used Uber to supplement his income. But as the rates began to fall, he tried to set up a meeting with a group of drivers and Uber's management in Seattle to discuss their differences.

Uber, he said, refused to meet with the group, and insisted drivers bring up their concerns individually. "That's when I started Googling 'Seattle unions,'" he said. The drivers got in touch with Teamsters Local 117, and began to organize.

Council member Mike O'Brien introduced the city ordinance in August, and it passed the Council's Finance Committee in October with a unanimous 7-0 vote. Then Uber began to mobilize. The company ran ads in the Seattle media market that featured testimonials from drivers who hinted the law would make their schedules less flexible. Next, Uber dispatched David Plouffe, the company's vice president and a former campaign manager for President Barack Obama, to give a speech to Seattle business leaders. Plouffe also met with the city's lawmakers behind closed doors.

Plouffe's speech, delivered on November 3, just weeks after the ordinance passed out of the City Council's finance committee, was called "Uber and the Future of Work." He urged local business leaders to oppose the law, arguing that most Uber drivers work part-time and unionization doesn't make sense for "temporary work."

Creery was in the audience that day. "He was really out of touch, saying drivers were working to make an extra 10 or 15 thousand dollars year so they could take their family to Disneyland or something," he recalled. "But the 200 drivers who are part of our coalition, we do this full time — this is our job." Uber says about 30 percent of its drivers nationwide drive full-time, with the rest balancing other jobs or school.

Uber has also argued that the proposition runs afoul of the National Labor Relations Act. "I think the ordinance is puzzling because it's generally believed to be flatly illegal," Plouffe told the Seattle business leaders. "I assume the courts will look at that if it were to be successful."

The Seattle law isn't the only challenge to how Uber does business. A class-action lawsuit in California, brought by drivers who want to be classified as employees rather than independent contractors, is working its way through the courts. Just last week, US District Judge Edward Chen expanded the number of drivers in the suit from a few hundred to more than 100,000. The trial begins in June, and is viewed as a legal referendum the use of "contract workers" by ride-sharing companies.

Related: That Little Lawsuit Against Uber Just Got Bigger — And Could Take Down The Sharing Economy

Uber has long argued the its relationships with its drivers is not that of employer and employee, but rather a deal struck between partners. Collusion between drivers, Uber has said, amounts to price-fixing and violates anti-trust laws.

With Plouffe hinting that Uber would sue the city to repeal the law, Council members were under pressure. "We knew we were up against a company that's worth $62 billion," Dawn Gearhart, an organizer with Teamsters Local 117, said. "But we have the votes, and that's what matters."

Uber is not commenting publicly on the Seattle ordinance, but industry watchers say the law is a serious challenge to the ride-sharing business model. "It has the potential to drive Uber out of cities," said Eli Dourado, director of the Technology Policy Program at the Mercatus Center, a free-market think tank at George Mason University. Dourado was skeptical, however, that unionization will help Uber drivers in the long term. If the business climate gets too hostile in the city, he said, Uber will just leave.

"The drivers own the cars, and have invested most of the capital so Uber can just say 'sayonara,'" Dourado said. Asked how drivers can effectively present their concerns to the company, Dourado suggested someone should invent "Uber for labor relations."

Creery, the Drivers' Association leader, hopes Monday's vote in Seattle will restore some balance to the driver-manager relationship — so he can keep working without feeling ripped off. "I don't think of this as a defeat of Uber," he said. "This is capitalism, by looking out for ourselves we are making the system run better for everyone." 

Follow Avi Asher-Schapiro on Twitter: @AASchapiro

Photo via Flickr