Rideshare companies will remain

One closely watched issue for the 2024 Minnesota Legislature is that of how transportation network companies’ (TNC) drivers are compensated. […]

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One closely watched issue for the 2024 Minnesota Legislature is that of how transportation network companies’ (TNC) drivers are compensated. State lawmakers passed a measure to increase driver pay, as part of a massive omnibus bill. 

Gov. Tim Walz signed the measure May 24, after vetoing TNC legislation in 2023. It takes effect in December. 

The changes don’t apply to drivers on delivery platforms, such as DoorDash or UberEats. 

The changes provide an array of protections for drivers and riders. But changes in state law also could bring higher fares. 

The controversy over rideshare services and wages caused consternation for people with disabilities who use rideshare services. It also shone a brighter spotlight on the problems some disabled riders face with TNCs. 

Many rideshare vehicles aren’t accessible to people who use wheelchairs or scooters, or who have mobility issues. In other cases, drivers have refused to accommodate riders who use service animals. Those issues were in the mix in the 2024 session, especially the need to provide more accessible vehicles. But they weren’t addressed to the satisfaction of many disability advocates, who still want and need accessible options. 

Ideas brought forward during the session included incentives to help drivers purchase accessible vehicles, as there are questions as to whether or not that would be done voluntarily. As the session’s end neared, a proposal was introduced to provide $2 million from the state’s workforce development fund. It would have created a vehicle loan program for drivers, at 0 percent interest. Loans would have been available at $15,000 for regular vehicles and $20,000 for wheelchair-accessible vehicles. Eligibility requirements were in place for drivers seeking loans. That didn’t pass. 

The Minnesota Consortium for Citizens with Disabilities (MNCCD) hopes to bring accessibility measures back in 2025. 

Still, the new law is expected to resolve a debate that has gone on for many months at the state and local levels. But it accelerated a conflict between state leaders and the Minneapolis City Council. That council passed its own wage requirements earlier this year, prompting Uber and Lyft to announce they would no longer provide services there. 

The state action pre-empts local actions on wages. Minneapolis council members posted criticism of Walz and state lawmakers on social media after state lawmakers acted. Cities can still license and regulate TNC companies. 

The minimum pay for drivers statewide is set at $1.28 per mile and 31 cents per minute, not counting tips. Drivers must earn at least $5 per trip. If a driver has a wheelchair-accessible vehicle, the driver is entitled to an additional 91 cents per mile. 

The rates are tied to inflation going forward. 

Eid Ali, president of the Minnesota Uber/Lyft Drivers Association (MULDA), called the measure a victory for drivers, although many MULDA members preferred the Minneapolis proposal. MULDA represents drivers, who have worked for higher pay in Minnesota since 2022. Drivers filled the capitol hallways during the session, calling for the measure to be passed. 

A Minnesota Department of Labor and Industry study found that 50 percent of Uber and Lyft drivers in the Twin Cities metro area earned $13.63 per hour or less while driving. In the rest of Minnesota, 50 percent of Uber and Lyft drivers earned $8.12 per hour or less.  In Greater Minnesota, where only about 5 percent of  TNC rides are taken, drivers are not assured of earning the state minimum wage. Drivers there spend more time driving to pick up their riders, and waiting for fares. 

So how will things play out? That remains to be seen. Drivers and their supporters are waiting to see if scholarship programs, a community center for drivers and other amenities, will be restored or retained. 

Uber and Lyft will stay. But they faced increased competition from other rideshare companies. Several companies, including startups and veteran TNC companies from other cities, announced this spring that they are interested in coming to Minneapolis and the rest of Minnesota. Those companies must go through city review and approval processes before they can be licensed to operate here. 

Taxi companies in Minneapolis were poised to take on more riders had Uber and Lyft left. But the TNCs have already provided strong competition for traditional taxi companies, to the point where Minneapolis alone has few taxi companies left that are based in that city. 

St. Paul has also lost traditional taxi firms, as has Bloomington. St. Paul riders with disabilities lost one of the few firms largely dedicated to medical calls and riders with disabilities when Green and White Taxi closed its doors several years ago. 

Another issue with taxis and their use by riders with disabilities is that taxi trips can be more expensive than rideshare.  

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