Seattle Driver-For-Hire Union Law Escapes Court Fight

  • Judge says Chamber of Commerce didn’t show members are harmed
  • Lyft says measure conflicts with U.S. labor, antitrust laws

It’s too soon for a lawsuit against Seattle’s first-in-the-nation law that allows union organizing by drivers-for-hire, such as those who work for ride-share companies Uber Technologies Inc. and Lyft Inc.

So says a federal judge who ruled Tuesday that the U.S. Chamber of Commerce was premature in suing to overturn a measure that took effect in January.

The question of whether Uber and Lyft drivers can unionize is part of a larger fight over how sharing economy companies treat their workforce. Uber’s business model is under attack worldwide by the taxi industry, local governments and drivers.

The Teamsters-backed measure, unanimously approved Dec. 14 by the Seattle City Council, requires taxicab and for-hire car companies to negotiate with a “driver representative" over the terms and conditions of work, if a sufficient number of drivers choose to be represented.

The Washington-based chamber alleged in its March lawsuit that “if allowed to stand, Seattle’s ordinance would threaten one of the most vibrant, cutting edge sectors of the economy.” The business group claimed that drivers will violate antitrust laws if they band together to negotiate rates with Uber or other ride-share companies.

The chamber said Tuesday that while the judge decided it’s too early to take up its case, he made it clear in court that he stands ready to hear a challenge to the law in the future.

“The city has merely delayed coming to grips with the legal flaws at the heart of this ordinance at great cost and uncertainty to the taxpayers of Seattle,” Blair Holmes, a spokeswoman for the organization, said in an e-mail. “We urge the city to reevaluate whether it should defend this law in court.”

Lyft’s ‘Flexibility’

“We continue to share concerns raised by the U.S. Chamber of Commerce that the ordinance threatens the privacy of drivers, conflicts with longstanding federal labor and antitrust law, and would undermine the flexibility that makes Lyft so attractive both to drivers and passengers,” Adrian Durbin, a Lyft spokesman, said in an e-mail.

U.S. District Judge Robert Lasnik said in Tuesday’s ruling that the chamber’s members lacked standing to pursue the lawsuit because they didn’t show they have been or would be harmed by the ordinance.

“The Chambers’ theory of standing relies on a speculative chain of events controlled entirely by the choices of third parties not currently before the court,” he wrote.

The judge said it’s not a sure thing that a union would want to represent the drivers. It’s just as likely that a union would first want to try out Seattle’s new procedures with drivers for a company that has “not made its antipathy toward collective action so well-known,” he said.

Uber representatives didn’t immediately respond to e-mail messages after regular business hours seeking comment on the ruling.

Independent contractors typically aren’t entitled to labor standards such as minimum wage, health and safety guidelines or reimbursements for work-related costs.

The case is Chamber of Commerce of the U.S.A. v. City of Seattle, 2:16-cv-00322, U.S. District Court, Western District of Washington (Seattle).

(Corrects day ruling was issued in second, ninth paragraphs.)
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