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The Impact – New Pay Guarantee for Rideshare Drivers & Highest State Minimum Wage

Mike McClanahan profile by Mike McClanahan

Next year Washington will have the highest minimum wage among all fifty states.   

Starting January first of 2023 the state minimum wage will be $15.74 per hour. That’s a $1.25 increase from the 2022 minimum wage of $14.49 per hour.

For workers who are 14 or 15 years old the minimum wage is 15% lower at $13.38 per hour. That’s an increase of one dollar and six cents per hour from 2022. 

Some cities will have a higher minimum wage. The city of SeaTac announced that the minimum wage for hospitality and transportation workers will be $19.06 for 2023.

Another change that will apply to people on salary who don’t qualify for overtime pay for working more than forty hours a week.

The state has set a minimum salary that a business can pay such workers and still consider them exempt from time and a half pay. The threshold varies based on the size of a company and the type of company in some circumstances

In 2023 for companies with fifty or less employees, workers on salary will qualify for overtime if they earn less than $57,293 dollars per year, which is about $1,100 per week on average.

For larger employers with fifty-one or more employees, salaried workers will qualify for overtime if they earn less than $65,478 dollars per year, which is just under $1,260 per week.

A new employment law that takes effect in 2023 will make Washington the first state to require minimum pay rates and job benefits for people who drive for rideshare companies like Uber and Lyft. These are often people who use their personal vehicles to earn money transporting passengers for one of the digital ride hailing applications.  

House Bill 2076 established a minimum per trip, per minute, and per mile rate for rideshare drivers starting next year. It will also requires the companies they work with to provide paid sick time and some workers’ compensation coverage.

For each trip starting and ending outside of Seattle, the greater of 37 cents per minute with passengers plus $1.27 per mile or a minimum of $3.26 per dispatched trip.

Bryan Templeton manages the Employment Standards Program at the Department of Labor and Industries  which will oversee both the statewide minimum wage and the new rideshare wage floor rules.

“A lot of drivers do this as a full time,” said Templeton. “They have a sick day like any other worker in the state of Washington. They should be able to take that day off knowing full well that their compensation for that day is covered.”

According to Templeton, the Transportation Network Company wage law, will apply to around 80,000 people across the state.

Seattle’s preexisting rideshare wage floor law set higher rates per minute, mile and trip. Once  the statewide rules take effect the terms of HB 2076 will apply in Seattle as well, and enforcement will fall to LNI, which will be in charge of enforcing the rules statewide.   

The legislation also required the creation of a new driver  resource center run by a third party to represent drivers during deactivation disputes- and appeals over the loss of platform driving privileges.  LNI has selected Seattle-based Drivers Union with fulfilling that role.  

The new wage rules do not apply to food or grocery delivery services or traditional taxi services.

Watch the interview with Bryan Templeton here:

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