Speaker 3: Well, to the report of the Public Safety and Human Services agenda item to council, but one to 0 to 94 relating to app based worker labor standards, establishing a compensation scheme for app based workers with the minimum requirements and related standards for transparency and flexibility. The committee recommends the bill pass.
Speaker 1: Thank you. Kiss rehearsal. Thank you so much, Madam Chair. And have some initial remarks here. And I think we also have. Do we have an amendment? We do. All right. So I will with your with your permission kicks off with my initial remarks. Thank you. So as we all know, we live in a very expensive city. And we also know that many app based delivery workers earn below the minimum wage after expenses and tips are accounted for. One platform that claims its workers receive $28 an hour after including tips and not accounting for expenses, also has one of the highest numbers of employees on food stamps in all of Washington state and one of the highest numbers of employees on Medicaid in all of Washington state. We know that app based work is one of the fastest growing sectors of our economy, with more and more workers turning to this type of work and not receiving the protections of basic labor standards. The passage of this legislation today would help tens of thousands of delivery workers make.
Speaker 3: Ends meet.
Speaker 1: While maintaining their flexibility. This conversation has been almost a year in the making. On June 9th, 2021, we held our first stakeholder meeting with. Since then, a total of a dozen large stakeholder meetings, followed by many additional one on one meetings. I want to thank the many participants in those efforts. This included representatives from DoorDash. DoorDash. Uber. Eats. TaskRabbit Rover. Instacart. Gopuff Chip. Seattle restaurants, United Workers and worker advocacy groups such as Drive Forward Working Washington and the National Employment Law Project. During last week's committee discussion, central staff walked us through 16 separate amendments. The committee then voted and with one abstention and four votes in favor to recommend the bill to the full council today. This is a testament to the hard work everyone has put into this process. While we know there are still some app based businesses that are concerned about the legislation. The fact is that, again, this is a very expensive city to live and work in, and if paying employees subminimum wage is the only way that businesses can sustain their model, there should be some consideration whether or not that business model really works. We know that these businesses are making record revenues. With DoorDash reported nearly 5 billion in revenue in 2021, up 69% over 2020. They also paid their CEO over $400 million in 2020. Uber Eats reported $5.8 billion in revenue for the fourth quarter of 2021, beating their own estimates and Instacart's 2021 revenue grew 10% year over year to 1.65 billion. That company's valuation is 24 billion, up four from almost 18 billion just a few months prior. Given this, how is it that paying workers a minimum wage could be a threat to their business model? Though I'm really disappointed that the legislation is passed out of committee strip protections for many app based workers. Let's remember that the legislation that the council passed last June, the Independent Contractors Protections Ordinance, means that independent contractors that are not covered by today's bill will have access to information so that they can receive pre-contract disclosures, timely payment and payment disclosure disclosures for services valued at $600 or more. The Office of Labor Standards has been conducting the directors rule process this year for that bill, and all of these protections will go into effect beginning of September this year. To the small businesses concerned about price increases, we know that a lot of small businesses are strongly in favor of this legislation like Seattle Restaurant United. But for those who do still have concerns, do keep in mind that you are currently protected from price increases in April of 2020. The former mayor signed an emergency order that prevents app based delivery companies from charging more than 15% of the purchase price of an order. And I understand that Council is working on drafting this policy as the Council bill to extend that protection. And I really look forward to supporting that, that incredibly important legislation. Remember, every dollar in a low wage workers pocket adds $1 in $0.21 to the economy and investment in our local businesses. And it leads to job creation, too, though, as we heard today, the app based platforms still have concerns. I do want to highlight the other alterations made to the bill on their request that I did support. We reduced each of the associated cost factors, the associated time factor and the associated mileage factor. These are all inputs that resulted in reducing the minimum payment calculation as originally proposed. We included a requirement that all US Office of Labor Standards produce the notices of rights and translations removing that burden from the company. We included a requirement that allows network companies to take adverse action against a worker for fraud if that company has a fraud policy. And we have changed the effective date of the ordinance from 12 months to 18 months. Remember that the transportation network company legislation, the fair share, was passed unanimously back in November 2019. The effective date for that legislation was January 1st, 2021. That gave them 13 months for rulemaking and for companies to adjust for pay up. We now have an effective date of 18 months after passage. That's five months longer than fair share. This gives the platforms more time to adjust, but also remember. It also means that the workers that we've been hearing from today will be waiting two years longer for the same kind of guarantees that taxi drivers are already receiving thanks to our legislation. I have some some closing remarks after hearing some a lot of. Thanks, Jim. Hopefully after hearing the amendment. But that's what I wanted to say from my opening remarks. All right. Remind me to come back to you, too, because I'll forget to do closing remarks. Councilmember Ellis, I understand you have an amendment, and even though it's labeled Amendment 17, I'm guessing it's 17 because 16 were in committee. Okay. Yeah, I'm not on that committee, so. Yes, but that is my understanding as well. And I would like to move to amend Council Bill 1 to 0 294 as presented on Amendment 17, which we did distribute before noon today. Second. Oh, I'm. You moved it. I second. It's been moved in second. Go ahead, Councilmember Ellis. Thank you. Well, I did watch the committee over the weekend and it was disappointing to see workers on a marketplace network. These get excluded from the policy at the last minute. I do believe that we need to make sure that these workers are protected as well. This amendment really expresses the council intent to consider regulating marketplace network fees regarding minimum payment flexibility and transparency protections in separate legislation no later than next summer, August 1st, 2023. I think it's important that we pass the legislation today and continue moving forward on additional policies to protect workers in our city. Because whether you get a job from an app or a want ad, work is work. And every worker deserves basic rights like minimum wage. So I am offering this amendment today in hopes that my colleagues will support it. Thank you. Councilman Morales, are there any comments for Council Morales before we move to a vote on the on Amendment 70? All right. Not seeing any. Will the clerk please call the role on the adoption of Amendment 17? Councilmember Herbold? Yes. Councilmember Lewis.
Speaker 0: Yes.
Speaker 1: Councilmember Morales. Yes. Councilmember Mosquera.
Speaker 3: I.
Speaker 1: Councilmember Nelson. Okay. Councilmember Peterson.
Speaker 0: No.
Speaker 1: Council members? Yes. Councilmember Strauss.
Speaker 0: Yes.
Speaker 1: Council president. Whereas. Yes. Seven in favor to oppose. All right. That means that the motion carries an amendment, 17 is adopted, and now the amended bill is before the council. So with that, I will hand it back over to Councilmember. I was hoping to give closing remarks. I don't know, particularly my co-sponsor, Councilmember Lewis might have some remarks as well. Yeah, I'm sorry. I apologize. Councilor Lewis has his hand up, too. So you came? I can't see. Is it just Casper Lewis? All right, Casper Lewis. And then councilmembers.
Speaker 0: Want council President Suarez appreciate the opportunity to briefly speak to this legislation and appreciate the partnership of Councilmember Herbold in moving this forward. This is the first in a series of measures to right size long standing inequities in our local economy that the introduction of gig work and app based work has driven over the past decade of technological changes and shifts in our economy. You know, this legislation by no means is going to be the final word on this. I appreciate the amendment brought by Councilmember Morales putting a timeline for one aspect of future legislation which will be looking at ways to. Create some level of certainty and regulation into how the marketplace that's conducted their work, but also several other pieces of legislation, including how do activations work in this world and transparency and and notice of how these pay standards impact folks who are in this gig economy. As Councilmember Morales just noted. A lot of this work increasingly is being driven not because it's new work or new types of jobs that people do, but because there are new ways to deliver them across varying business models. This council previously moved to regulate the transportation network companies Uber and Lyft in that same vein. Today we extend those regulations to delivery companies and soon will be considering other aspects in this economy and appreciate the work of Councilmember Herb in bringing us together. Very much appreciate the work of Camilla Brown on my staff, who has worked hand in hand with Alice Clardy in the Herbold office in the stakeholder ring and bringing together our folks appreciate the work and the stewardship of work in Washington, in this area, as well as all of the partners from other organizations who have provided input , including representatives from the platforms and representatives from drive forward. So this is the first step in continuing the mission to expand increasingly what the role and future of work is going to look like in the city of Seattle. And I look forward to continuing this work throughout this year and into next year and to continue to monitor this legislation as it goes into rulemaking. So I appreciate the opportunity to speak to this and look forward to voting.
Speaker 1: If you just so I make sure I got the role, I got it correct, I think. Casper So what was next? And then Councilmember Mosqueda and then Councilmember Morales and then Councilmember Nelson and I write this down. I apologize. I kind of got it mixed up. Casper Salon.
Speaker 2: Thank you. I voted yes on the amendment, and of course, I support the legislation as a whole. And I thank all the workers who spoke today and previously in public comment in support of the legislation. As a socialist, I have repeatedly explained in the past that big business under capitalism has enormous power, and every victory of the workers movement that has been won comes under attack and is gradually chipped away. When the movement as the only alternative really is to fundamentally end the power that big business has to claw back every penny that workers have won and fight for global socialism. Big business does not want to pay minimum wage. It does not want to respect other worker rights. And when we say big business is not an inanimate object, it is the billionaires, it's the multi-millionaires, it's the very wealthy, the elite. So they invent the notion of gig workers, so-called gig workers, independent contractors. And suddenly you you have a whole section of the workforce where workers rights regulations apparently do not apply. The evolution of the gig industry is also linked in other ways to the fundamental nature of capitalism. It is not only the reforms that have been won by workers are constantly under attack, which they are. But the gig industry also illustrates how, as the global capitalist system has gone deeper and deeper into a long term crisis over the last decade, the billionaires and the multimillionaires have increasingly created more and more avenues to squeeze every last drop of blood from the global working class. And that is why you see the evolution of such industries now that the pay gap legislation would extend minimum wage protections to gig workers at the last minute, and committee members Peterson, Nelson and Lewis passed an amendment to create a new legal section called so, quote unquote, marketplace network workers. And no doubt more and more big businesses will redefine the marketplace. Network workers, no doubt more and more big businesses will redefine themselves into that loophole. Really, the city council should be reversing that loophole. But that was not the amendment before us in the last vote. I support this legislation to close the loophole in minimum wage protections created by the independent contractors legal notion. And I will support closing the marketplace network loophole too. If members want to do that. The workers movement fights for better wages and that is essential. And we also need to fight for socialism. So we are not continually the working class is not continually forced to fight for the right to survive like.
Speaker 1: You customers want. Council Member Mr..
Speaker 3: Thank you. Council President. And thanks again to Councilmember Herbold and to Councilmember Lewis, the co-sponsors of this legislation. It's my. My great privilege and pride to be able to support you in this legislation today and to continue to underscore for members of the public how long this process has been under way. And to say that it's been coming for a long time is an understatement. We knew that this type of legislation was needed for basic standards to protect gig workers. And the concept of the pay gap legislation and the campaign fund community really got a lot of attention way back in 2019. And since then, gig workers, frontline workers, quote, essential workers and workers that we deemed to be heroes have only since then, because of the pandemic, been put more in the spotlight in terms of the type of work they've done and more at risk to do the work that they do during this pandemic. So I'm excited to support this legislation today and to recognize the many months, the years of hard work that went into this piece of legislation. And to really as well thank the staff from the from the co-sponsors, Alex Clardy and Camilla Brown. I also want to thank central staff and named them by name. Amy, Carina and Jasmin. I know that they have done a tremendous amount of work with specifically Office of Labor Standards, but many of the other departments as well to craft the legislation. And I know, Councilmember Herbold, you are saving your thank you. So I hope I'm not stepping on toes, but I know that they probably don't hear it enough. So I do also really want to thank several for my chief of staff who has worked with these what the pieces of the piece of legislation in front of us through the various iterations and in close coordination with Alex and Camilla, as well as members of the Mayor's Office and Office of Labor Standards and the broad community, both the community of worker representatives as well as industry representatives, to further understand the implications of the bill in front of us. So thanks as usual, for the hard work that she did as well in digging into this legislation. I will be as well voting yes, as I noted. But I do want to underscore the significant reservations due to the amendments that were made in committee last week. This legislation, it will still benefit thousands of workers. That should be a moment where we all celebrate today. But to be honest, we also need to at the same time, recognize that the amendment that was passed in committee last week cuts out basic protections for thousands of other workers and sets a precedent that I hope will not replicate across this country. And I appreciate the amendment that was brought forward today so that we can continue to work on this policy area. We all know no policy is perfect, but when faced with the decisions, I think it's our belief and in my office that we always err on the side of listening to those who are on the front line, listening to those who have less power, listening to those who are in more vulnerable situations. And with the lived experience of being deprioritized, whether it's on platforms or deprioritized in terms of funding and protections and state and federal law, we need to continue to listen to those voices who have been on the front line. And we will not relinquish in our efforts to make sure that more workers are folded into these protections today. I appreciate everyone who has continued to call in and offer robust testimony and to explain how separate policy from marketplace workers will impact them. Looking forward to continuing this conversation throughout this year. As I know, council her will do have other pieces of legislation in the hopper and we'll look forward to the following conversations in 2023 as well as noted by the amendment. And thanks as well for the committee members for your support for the amendment that we put forward. Councilmember Hubble's and I put forward an amendment to make sure that we were looking at the implications for the budget this year and that we began a process of ensuring that there was additional conversations around drawing in revenue, especially in difficult budget year. So I look forward to building on this legislation and to celebrating all that workers were able to accomplish today without letting our eyes off the end goal of getting more workers included as well. So congratulations to everyone who has fought for pay up and thank you very much for all the work that you've done to incorporate so many different voices, ours included. And congratulations on this win today.
Speaker 1: OC House member Alice. Thank you. I am also excited for this legislation and the pieces that I know will be coming in subsequent weeks and months. We know that there's over 40,000 workers in Seattle who depend on work, particularly people with disabilities, people of color, immigrants, single parents, LGBTQ workers. And and these apps, while they do provide an opportunity for folks to find employment who might have challenges otherwise, they also shift all of the costs and all of the risk to workers and really leave them earning well below minimum wage after expenses. We know that a recent report found Seattle gig workers are getting paid just 958 an hour. 92% of jobs pay less than minimum wage. And we know that there has been an exploitation of a of a glaring loophole in our labor standards, simply calling workers independent contractors that these multibillion dollar gig apps have been able to evade basic protections. And that's the problem that we're trying to solve here. So the pay policy that is up for a vote today will close that loophole. It will ensure basic protection for thousands of workers by ensuring that they're paid at least minimum wage with other basic protections, regardless of whether somebody is cleaning a house or delivering food . That's the goal, is to make sure that that regardless of the kind of app that they're on, we.
Speaker 0: Are protecting workers.
Speaker 1: And those who companies choose to call contract workers. So I think it's an exciting day. Seattle is leading the way by listening to gig workers, providing them what they need in these jobs, as I said, have the potential to be good paying jobs with important options for people who need flexibility. I do think it's important that rather than pass fair pay costs onto consumers, companies, some of which saw their revenues soar by close to 70%, this councilmember, Herbold said, should themselves pay the true cost of labor out of their own pockets and stop the exploitive model from becoming the new norm. I'm looking forward to supporting this, to supporting future legislation and continuing this conversation over the next year. I do want to thank my staff as well, Alexis, all of our and Silverdale who've been working on this with our colleagues and.
Speaker 0: Look forward to supporting.
Speaker 1: Thank you. Councilman Morales, I really like what you had to say, Councilor Nelson. Thank you very much. I support a minimum pay standard for delivery drivers, but I've always been concerned that setting the per delivery fee to high will lower demand, which could result in the consequences of reducing drivers overall income as well as the revenue.
Speaker 3: Of small.
Speaker 1: Businesses like restaurants. It could also disproportionately impact the most vulnerable customers, who also tend to be low income and might not be able to afford the fee. So I'm ambivalent about this legislation, but I'll be supporting it today because it's vastly improved from the bill that was introduced most significantly by Councilmember Peterson's amendment, which I supported, to remove.
Speaker 3: Marketplace companies from.
Speaker 1: Being covered by working Washington's proposal, because I believe their inclusion was an overreach. It made no sense to me to regulate apps used by service providers who set their own rates and negotiate directly with the customers to provide things like home health care, child care, pet care and help with household tasks. Just because those professionals use an app to reach some of their customers in places, I just really hadn't seen.
Speaker 3: Convincing evidence that the.
Speaker 1: Majority of them make under the minimum.
Speaker 3: Wage.
Speaker 1: So I ran as a pragmatist. And quite frankly, this this proposal has a long.
Speaker 3: History.
Speaker 1: And I believed it would pass. So I submitted several amendments and collaborated with my colleagues to minimize its negative impacts. Voting no would diminish their confidence that I can negotiate in good faith to improve future legislation, whatever it is. And so, well, that's what pragmatism is. And I'll be voting yesterday. Great. Thank you, Councilmember Nelson. And I like what you said, too. So I'm going to be supporting this. And I'll tell you why. I probably should tell everyone I like what they said, but I'll say I'll share with you. I'll be voting yes. But Councilmember Morales and Councilmember Nelson kind of hit the nail on the head for me. We have been dealing with the gig economy and I like what Morales said, and I've always felt this way. To some degree, it is a very exploitive model. And until we answer the question about whether or not a gig worker is an employee or indeed a contract worker, and we haven't addressed that straight on for the labor and for this economy and the people that actually take on these jobs. We're going to continually piecemeal in be trying to how to decide this works when we have a gig economy. I believe we're going in the right direction, that this is the shape of things to come because this is it's a labor issue and there's a surge about people who these are their jobs. And I think it is unconscionable that the and I'll just say that the bigger business companies have made billions of dollars during this during our pandemic. And if that's what it took, as you know, the pandemic has taught us many lessons, if that's what it took for us to get here, for people to recognize how much money these companies are making on people who they cannot do not have to call them employees. So what we have done as a city and a lot of other cities as well is take it upon ourselves as we should do as elected officials, to start deconstructing this economy and making sure that the people who are on the front lines, who we're delivering for, who are doing all those things, are compensated and are taking care of because that's our job. At the end of the day, is government officials, is to make people's lives hopefully better. So with that, we were handed over to you two closing remarks and then we'll call on the clerk to call the roll. Thank you so much. I really appreciate my colleagues excitement for the vote that we're about to take. In closing, I just want to read a couple sentences from the May 10th letter to counsel from the National Employment Law Project. They start talking about the history of the minimum wage. I quote The New Deal legislation excluded domestic, agricultural and temp workers from their wage protections of the Fair Labor Standards Act and systemically denied black people and workers of color the ability to earn the wages guaranteed to workers in industries dominated by white workers. And the legacy of this injustice continues today. More recently, venture capitalists running app based businesses deny workers the minimum pay and benefits that should be universal. As a city council itself recognize black and Latino, black and Latinx workers comprise a disproportionate share of the 40,000 individuals performing app based work in Seattle. The fact that app based workers are disproportionately immigrants and people of color reflects on the racialized exploitation within the app based delivery and marketplace industry. Indeed, the app based gig economy writ large functions on occupational segregation. Companies can get away with offering poor quality, unsafe jobs where workers have virtually zero legal protections on the job because for so many workers, there is simply no alternative. Far from offering economic opportunity, this business model deepens the desperation of underpaid black, Latin and other workers of color who have been shunted to the bottom of the economy. In closing, in addition to the stakeholder process I talked about earlier, the pay policy package has been discussed six times in a council committee, my council committee since July of 2021. I am just so honored to have had the opportunity to work with this growing workers movement who are determined to not be left behind. There's significant support for this legislation, including from the Seattle Restaurants United, a coalition of more than 240 small restaurant owners and operators. The Washington Local Housing Alliance. One America. Puget Sound Sage. Somali Community Services Al-Noor. Islamic Community Center. El Centro de la Raza Castle Latina. Asian Counseling and Referral Service. The National Domestic Workers Alliance. The National Employment Law Project. SEIU 775, SEIU six, the Transit Writers Union and the Labor Standards Advisory Commission. We will continue our work with additional legislation to cover issues such as restaurant access, anti-discrimination background checks, deactivation, and the creation of an advisory board. And I will continue to work with all stakeholders on the development of these policies. I want to thank Council. Members and their staff, specifically my co-sponsor, Councilmember Lewis and Camilla Brown from his office. I also want to thank the Office of Labor Standards, specifically Karen Le Virus and Lane Midha. I want to recognize the hard work of council central staff, specifically Carina Boal, Amy Gaw and Jasmine Marois. Finally, I want to thank Alex Clardy in my office. His work has been the driving force for the development of this legislation, and I want to thank him from the bottom of my heart for his time, diligence and attention to detail. I hope we can vote yes on this really important legislation today. Thank you. He also a verbal thank you for I. I normally don't do a bunch of thanks but I really want to thank you and your staff and essential staff. I know what it's like to get 16 amendments and try to accommodate and keep them all moving. So thank you and thank you and your staff and Alex and central staff and all the folks that did what they did. We got a running list of what the amendments were, which ones were passed, which one people abstained, how people voted. So thank you very much for this hard work. Okay. So with that, Madam Clerk, will you please call the roll on the passage of the amended bill? Councilmember Herbold. Yes. Councilmember Lewis.
Speaker 0: Yes.
Speaker 1: Councilmember Morales. Yes. Councilmember Mosqueda, I. Councilmember Nelson. Councilmember Peterson.
Speaker 0: Yes.
Speaker 1: Councilmember Salant. Yes. Council member Strauss.
Speaker 0: Yes.
Speaker 1: Council President Juarez. Yes. Nine in favor. Nine opposed. Yay! Thank you. The bill passes as amended and the chair will sign it. Will the clerk please affix my signature to the amended legislation? Thank you. Okay. Moving on in our agenda to the adoption of other resolutions, there are no other resolutions for introduction in adoption today.
AN ORDINANCE relating to app-based worker labor standards; establishing a compensation scheme for app-based workers with minimum pay requirements and related standards for transparency and flexibility; amending Sections 3.02.125, 3.15.000, and 6.208.020 of the Seattle Municipal Code; and adding a new Title 8 and Chapter 8.37 to the Seattle Municipal Code.