Next week, Seattle’s City Council is expected to vote on an ordinance to create a premium pay requirement for gig workers. This potential law is supposed to provide relief for workers during the current health crisis, but a close look at the bill — and the organization backing it — indicates it could have just the opposite effect.
The bill’s main proponent and promoter is Working Washington (WW), an organization that acts as a front group for prominent labor unions. The Service Employees International Union (SEIU) is joined by the United Food and Commercial Workers (UFCW) and the Teamsters in funding WW’s latest objective: Organizing gig workers.
Before the group targeted the gig economy, its main objective was organizing restaurant workers in the city under the SEIU’s Fight for $15 campaign. The campaign, meant to incentivize unionization among restaurant workers, succeeded in helping pass a $15 minimum wage in Seattle in 2014, although it flopped in its main goal of unionizing the restaurant industry./
Seattle employers and their staff have been paying for the $15 experiment ever since. One report found that, although mandated wages were rising, workers were earning $125 less a month as employers were forced to cut staff hours. Local restaurant owners had to lay off employees; still, they feared for the long term viability of their business. Other restaurants closed for good.
One Seattle restaurant worker recently found herself out of a job after six years because her employer couldn’t bear the high labor costs. Looking for a new job was difficult, considering several other restaurants in town suffered a similar fate. And it wasn’t just restaurants — child care centers in the city were forced to cut jobs, reduce staff hours, and raise their tuition prices in response to higher wage mandates.
Now, the geniuses who helped ruin Seattle’s restaurant scene have set their sights on the gig economy. The latest WW-backed Seattle ordinance would create a $5 per order premium pay requirement for each online delivery or transportation service with a work-related stop in Seattle. That means an additional $5 every time an Uber or Lyft driver drops off a customer, or a DoorDash or GrubHub worker makes a delivery.
But the cost of an extra $5 per delivery, based on a union formula of $15 per hour (assuming three stops per hour), adds up quickly. What’s more, the legislation offers a threatening, vaguely authoritarian, and likely-illegal prohibition: “No hiring entity shall, as a result of this ordinance going into effect, reduce or otherwise modify the areas of the City that are served by the hiring entity.”
Get that? Under Seattle’s law, it would be illegal for a business to leave the city to reduce its costs. You’re damned if you do, damned if you don’t. As the Wall Street Journal argued in a recent editorial: “There’s no free lunch. Gig economy companies are struggling amid the pandemic—Uber has laid off more than a quarter of its workforce—so their customers and workers in other places will pay the cost of the regulation.”
Seattle’s workers face enough obstacles as it is. Passing yet another ordinance that makes it difficult to do business in the city only puts another hurdle in their way.