May 26 (UPI) -- Minnesota Gov. Tim Walz has vetoed legislation that would have required a minimum wage for rideshare drivers as Uber threatened to pull service from outside the Twin Cities if the bill became law.
Waltz, a Democrat elected in 2018, issuing his first veto as governor, said in a statement, "Rideshare drivers deserve fair wages and safe working conditions," but added, "This is not the right bill to achieve these goals."
Coinciding with the veto, Waltz signed an executive order to launch a commission -- led by drivers, riders, rideshare companies, disability advocates and labor groups -- to make recommendations for rideshare legislation next year.
"I have spent my career fighting for workers, and I will continue to work with drivers, riders and rideshare companies to address the concerns that this bill sought to address," Waltz said.
Minnesota stood to become "one of the most expensive states in the country for rideshare" under the bill, he said.
Prior to Thursday's veto, Uber issued a statement saying the company planned to end all operations outside the Minneapolis-St. Paul area beginning Aug. 1, and would limit rideshares to "only offer premium products to match the premium prices required by the bill," House File 2369.
"Following several months of unanswered requests to work with legislators on comprehensive legislation that provides flexibility and benefits to drivers without compromising service for riders, we are left with a bill that will make it impossible to continue serving most areas of the state," Uber spokeswoman Freddi Goldstein said.
The bill, which squeaked through both chambers of the Democrat-majority Legislature over the weekend before landing on the governor's desk, would have given drivers "minimum compensation" of at least $1.45 per mile and another 34 cents per minute on every rideshare in the Twin Cities area.
The bill also contained a provision for wages to increase each year to keep pace with the rate of inflation.
Rideshare drivers across the country have been rallying for better pay and benefits for several years as debate continues over whether drivers should be classified as employees or independent contractors.
A bill similar to Minnesota's was passed last year in Washington, which requires rideshare pay of $1.50 per mile and 64 cents per minute in Seattle, and $1.27 per mile and 37 cents per minute outside the city limits. Drivers there can also get sick leave and workers' compensation benefits.
Five years ago, New York became the first city in the nation to establish a minimum wage for rideshare drivers -- who today receive $1.31 per mile and 56 cents per minute for trips inside New York City, and a higher rate for trips outside the city limits.