Will the minimum wage for delivery drivers in Seattle be lowered?

The Seattle City Council is expected to debate and vote on a new ordinance that would repeal the recently-instituted mandatory minimum wage for delivery drivers.

Two years ago this week, a first-of-its-kind legislation — called PayUp — guaranteed app-based delivery drivers a minimum wage while protecting employment flexibility. After PayUp was passed by the Seattle City Council, gig workers were in line to receive a minimum pay floor of at least minimum wage for every hour worked with an active job.

A gig worker is an employee who does temporary or freelance work, especially an independent contractor engaged on an informal or on-demand basis.

The Seattle City Council passed PayUp on a unanimous vote in 2022 with the law starting last January.

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“Large segments of our economy are becoming more and more automated with lower pay and scant benefits,” former Seattle City Council member Andrew Lewis said in 2022 during the bill’s passage. “As the economy evolves, so too must the approach of local government. This bill is the first step to protect and expand the rights of workers who use these apps.”

Seattle City Council referenced a report from Working Washington that claimed 92% of jobs from app-based companies paid Seattle workers less than the minimum wage.

But in 2022 after PayUp passed, DoorDash — one of the largest delivery companies affected by PayUp — estimated Seattle businesses could lose over $74 million collectively a year, and DoorDash workers could lose over $32 million in collective earnings due to an expected drop in orders.

With the PayUp law mandating that workers earn 44 cents a minute and 74 cents a mile traveled, or a minimum of $5 per order, to guarantee a minimum hourly wage, delivery companies added a $5 fee to every order placed through their apps, along with a notice that this fee was now a necessary cost of doing business in Seattle.

With the added fees, delivery sales were down 30% in January, the first month the law was in place, compared to the same time last year, according to Seattle Eater. DoorDash estimated there have been as many as 300,000 fewer orders since the law passed, leading to a $7 million loss in revenue for area businesses.

The ordinance being argued by the council Tuesday would lower the minimum wage from $26.40 per hour to $19.97 per hour and cut the amount of money drivers earn per mile from 74 cents to 35 cents. It reportedly would also not require companies to reverse the added fees, but according to KOMO News, DoorDash said it could lower the $5 regulatory response fee if this legislation passes.

“The regulatory response fee in Seattle helps offset the costs associated with the current law,” a DoorDash spokesperson wrote in an emailed statement to KOMO News. “If those costs can be decreased through reform legislation, we will explore all options to increase affordability for consumers, including a reduction of the fee.”

The ordinance would additionally only pay drivers that are “en route” to a delivery as opposed to under the current ordinance where paid time starts when they accept an offer. Some delivery drivers, like Alex Kim, believe this puts delivery and other gig workers back at square one.

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“That would indicate that for every single minute I have my app on, I’m getting paid. That’s not true at all because you only get paid for active time,” Kim, who delivers for four different delivery apps, told KIRO 7. “I’m going to get paid $19.97 an hour only when I’m working and there’s going to be downtime that means I’m going to get paid less than the minimum wage in Seattle.”

The council was expected to vote on the ordinance Tuesday at 2 p.m., but according to Council President Sara Nelson, the vote has been postponed “to ensure the council has time to fully consider those changes.”

Contributing: KIRO 7

Frank Sumrall is a content editor at MyNorthwest. You can read his stories here and you can email him here.