The group has refiled its lawsuit against Seattle, arguing that the city’s law allowing Uber, Lyft and taxi drivers to unionize is illegal because drivers are contractors not employees. Seattle’s law is the first of its kind in the U.S.
The U.S. Chamber of Commerce has, for a second time, sued Seattle over its first-in-the-nation law that would give Uber, Lyft and taxi drivers the ability to form a union.
The Chamber previously sued last year, but a federal judge tossed that lawsuit in August, ruling that the law had not been implemented so the Chamber had not been harmed and could not yet sue.
Seattle’s law gives drivers the right to vote on whether they’d like to form a union and then to collectively bargain with their employers over things like working conditions and pay.
The lawsuit, refiled Thursday in federal court, argues that because Uber, Lyft and taxi drivers are contractors, not employees, they do not, under federal law, have the right to unionize — and Seattle does not have the authority to give them that right.
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Private employees have the right, under the federal National Labor Relations Act, to collectively bargain. But that protection does not apply to independent contractors like Uber and Lyft drivers.
Uber drivers, the lawsuit argues, are competitors, not co-workers, and allowing them to unionize is akin to “forming a cartel … and engaging in horizontal fixing of prices.”
The City Council unanimously passed its law in late 2015 and it went into effect a month later, without the signature of Mayor Ed Murray, who worried about defending the ordinance in court.
The Chamber refiled its lawsuit because Teamsters Local 117 recently got permission from the city to begin trying to organize drivers. Both Uber and Lyft oppose the city’s ordinance, saying it could hurt their drivers’ flexibility.
Unless the court steps in, the ride-hailing companies will have to turn over their drivers’ contact information to the union early next month or face a $10,000 daily fine.
The lawsuit calls Seattle’s law an “illegal conspiracy in restraint of competition” that will harm taxi companies, Uber and Lyft.
“Unions such as Teamsters will seek to reduce the prices paid to app-based companies for the use of their ride referral services,” the lawsuit says. “Those companies also will incur additional costs of doing business with the conspirators, such as reimbursement of driver’s expenses or payment of other benefits.”