Seattle minimum wage, protections for app-based delivery workers

On June 13, 2022, Seattle Mayor Bruce Harrell signed the law CB 120294, a move to ensure app-based delivery drivers receive minimum wage plus tips and compensation for expenses, increase transparency around job postings, and preserve worker flexibility. The app-based Minimum Worker Payment Ordinance is part of a set of six legislative proposals known as the “Pay», and it is the first of the political package to pass.

Coming into effect in 2023, the order covers “network companies” with 250 or more app-based workers globally and applies to on-demand app-based delivery drivers. The law does not apply to “market workers”, who plan and negotiate the rates for their orders, nor to carpool drivers in the transport network, who are already covered by a separate chapter of the law. Seattle City Code and a recently enacted law Washington State Law.

Minimum payment

The ordinance regulates “committed time” compensation for app-based workers in the City of Seattle. This includes time for services that begin in Seattle, regardless of where the service ends, or time for the portion of services occurring in Seattle, if the service begins outside the city limits of Seattle. . The law ensures that drivers, who are independent contractors, receive a “minimum wage rate” and receive standard mileage reimbursement from the Internal Revenue Service (IRS).

The required minimum payment must be the greater of (a) an amount calculated using a formula combining per minute and per mile amounts ($0.38 per minute and $0.64 per mile for 2022) multiplied by the number of committed minutes and miles, respectively, or (b) a per offer amount of at least $5.00 per offer.

An “offer” is defined in the order as “one or more online orders presented to an App-Based Worker as an opportunity to provide services for compensation which the App-Based Worker can accept or reject.” Cost, time and mileage factors will be adjusted over time.

Tips and gratuities must be paid to workers based on the application and do not count towards the “network company minimum payment”, the guaranteed minimum amount the network company must pay for an offer, inducement or any other compensation for services to be paid for. to workers.

Transparency

The order requires network companies to provide — “and/or ensure that a customer provides” — workers using apps with the information needed to make informed choices about which offers to accept and to verify compliance with minimum payment requirements. When facilitating or presenting an offer, information that should be provided to an app-based worker includes:

  • a reasonable estimate of the time and kilometers incurred to complete the tender and the approximate geographic location where the work will take place;

  • the guaranteed minimum amount that the network company will pay for the offer;

  • the amount of tip customers have indicated they will provide, if customers are able to specify tips in advance;

  • names of commercial establishments for required stops; and,

  • reasonably verifiable, information about the physical labor required to perform the offer, the accessibility of required locations and the contents of certain orders.

With respect to verifying compliance with minimum payment requirements, the order provides that within twenty-four hours of fulfillment of each offer, or within seventy-two hours of cancellation of a worker based on application, a network company must submit an electronic receipt containing specific information about each offer. Each week, network companies must provide a written notice with specific information about offers made or canceled with cause, as well as other weekly engagements with the platform.

In addition, network companies must provide the Seattle Office of Labor Standards with regular, routine access to certain company records to administer and enforce the provisions of the ordinance.

The order also provides customers with information about the nature of the fees, including amounts paid to workers and retained by the company via an electronic receipt required within twenty-four hours of performance or cancellation.

Flexibility protections

The order also includes provisions to protect worker flexibility, including the right to freely choose jobs and hours without adverse action, while maintaining the ability of network companies to serve customers and third-party companies.

What’s next for networking companies with Seattle workers

Future additional legislation in the PayUp package will focus on providing assistance to app-based workers regarding access to restrooms, anti-discrimination policies, background checks, protection against disabling and an advisory board of gig workers for the city of Seattle.

© 2022, Ogletree, Deakins, Nash, Smoak & Stewart, PC, All rights reserved.National Law Review, Volume XII, Number 175

Lance B. Holton