Lyft and Uber have reversed plans to leave Minneapolis on May 1 after a new minimum wage for rideshare drivers, originally set to go into effect that day, was delayed two months after the city council passed a measure Thursday to extend the deadline.
The issue stems from a March decision by the city council to override the mayor’s veto of a minimum wage for rideshare drivers, set at the local rate of $15.57 an hour. That prompted Uber and Lyft to announce they’re ending operations in the city.
Minneapolis City Council unanimously passed an extension at this morning’s meeting to push the effective date to July 1, allowing time for lawmakers to hammer out a compromise in the minimum wage law and give more time for new ride-hailing services to start.
Uber said in a statement Thursday that the council’s action “paves the way for all stakeholders to work with [Minnesota] leaders on a statewide solution that raises pay at the state level, protects flexibility and keeps rides affordable.” It will operate in the state until at least July 1.
Lyft, which also confirmed it will continue operating until July 1, said in a statement Thursday that it was “encouraged the Council is recognizing the flaws in their incredibly damaging ordinance.”
Mayor Jacob Frey, a Democrat, said he supported a minimum wage for rideshare drivers but opposed the ordinance because it didn’t factor in a Minnesota state study that analyzed how much drivers should be paid.
The ordinance mandates rideshare drivers make at least $1.40 per mile and $0.51 per minute within Minneapolis. However, the analysis Frey referred to showed lower numbers — $0.89 per mile and $0.49 per minute.
Now some council members want to amend the ordinance and lower the per-mile rate to $1.21, but maintain the proposed per-minute rate of $0.51.
“Leadership in decision-making entails gathering information, consulting stakeholders, and making informed choices, while also embracing uncertainty and adapting to new information,” the statement from the council members said, according to CNN affiliate KARE-TV.
“Our goals have and continue to be to ensure fair wages for drivers, stability for drivers and riders, and a healthy, competitive market. With this amendment, we can accomplish those goals.”
The statement was released by Council President Elliott Payne and Council Members Katie Cashman and Aurin Chowdhury.
This story has been updated with the latest details.
