Uber and Lyft are quitting Minneapolis over a driver pay increase

and plans to end its operations After the city council voted to raise the driver’s salary. The council made a decision on the matter last week. On Thursday, he voted to override the mayor’s veto of the measure.

The new rules require ridesharing companies to pay drivers at least $1.40 per mile and 51 cents per minute (or $5 per ride, whichever is higher) when they carry passengers. Tips are on top of the minimum payout. according to The council passed an ordinance to bring the driver’s pay closer to the local minimum wage of $15.57 an hour.

However, Uber and Lyft say they will suspend service in the city before the pay hike takes effect on May 1. Lyft says the increase is “deeply flawed,” citing Minnesota. shows that drivers can make minimum wage and still pay for health insurance, paid vacation and retirement savings at $1.21 per mile and 49 cents per minute. “We support a minimum earnings standard for drivers, but it must be done in a way that keeps the service affordable for drivers,” said spokesman CJ Macklin.

An Uber spokesperson told the publication that the company was disappointed by the council’s choice to “ignore the data and kick Uber out of the Twin Cities,” laying off nearly 10,000 drivers. lawmakers, “we can achieve comprehensive state legislation that provides drivers with a fair minimum wage, protects their independence and keeps rideshare affordable.”

But last year, Minnesota Governor Tim Walz to raise wages for Uber and Lyft drivers, citing concerns that the state has become one of the most expensive places in the country for ridesharing. Other jurisdictions, including those that require a minimum driver fee for ridesharing services New York Citythe rate here starts at about $18 an hour.

If Uber and Lyft follow through on their threats to leave Minneapolis, it could make it harder for people (especially people with disabilities and those who can’t afford their own cars) to get around. The rise of ridesharing has upended the taxi industry over the past decade. So the Minneapolis official there are currently only 39 licensed taxi drivers in the city, a significant decrease from 1,948 licensed drivers in January 2014.

Meanwhile, some start ridesharing companies and pick up from Lyft and Uber. and For example, they showed interest in starting operations in Minneapolis. Both companies ask drivers to pay a monthly subscription fee to use their platform and find drivers. In return, the drivers keep the entire fare.

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