(Reuters) – Uber Technologies and Lyft said on Friday they will stop operations in Minneapolis starting May 1 after the city’s council paved the path for rideshare drivers to be paid a minimum wage.
The council voted 10-3 to override Mayor Jacob Frey’s veto, ensuring rideshare drivers in the city are paid $15.57 an hour.
“We are disappointed the Council chose to ignore the data and kick Uber out of the Twin Cities, putting 10,000 people out of work and leaving many stranded,” Uber said.
Meanwhile, smaller rival Lyft, calling the bill “deeply-flawed”, said it hopes to return to Minneapolis as it advocates for a statewide solution in Minnesota.
This comes after rideshare and delivery drivers staged a protest on Valentine’s Day this year demanding fair pay and working conditions.
The New York Attorney General’s office said in November that Uber will pay $290 million and Lyft will pay $38 million to resolve a multi-year investigation into the companies, calling it the largest wage theft settlement in her office’s history.
A study by the Minnesota state’s Department of Labor and Industry published last week said the companies are unlikely to hike prices to levels that would significantly reduce consumer demand and commissions, adding that such an outcome was unlikely.
(Reporting by Akash Sriram in Bengaluru; Editing by Maju Samuel)
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