Unions and taxicabs have had their the plans thwarted; they can’t force drivers who drive for  ride-hailing companies such as Uber and Lyft to unionize.

We reported recently on the melee. Last November Seattle rolled out proposed rules for all independent contractors (including drivers of taxicabs, limos, and ride-hailing) to unionize if they wanted to but if they agreed, then all drivers would be forced to unionize and abide by the agreements the unions negotiate. That may work fine for taxicab drivers, but drivers in the ride-hailing or ride-sharing world are different. Some just work part-time (fewer than 20 hours a week) and do this for the flexibility. They would lose that flexibility and control over how much they make if they unionize and settle for one wage across the board.

Uber fought back by filing a lawsuit against the City of Seattle to block the rules from going into place. They’ve been successful

Bloomberg reports:

U.S. District Judge Robert Lasnik in Seattle on Tuesday granted a request by the U.S. Chamber of Commerce to put the city’s ordinance on hold before it goes into effect. The organization argued the law improperly treats independent contractor drivers as employees because it allows them to unionize and collude through collective bargaining over their fares. Uber and Lyft are members of the chamber.

… The judge emphasized that his ruling is temporary, and not a sure sign that the Chamber of Commerce will ultimately prevail.

The fight is not over. The City of Seattle vows to keep up the fight. At issue is whether drivers should be reclassified as workers and able to unionize. It Courts hold that they can be classified, thus would disrupt the business model of Lyft and Uber perhaps even other companies in the sharing economy. So the stakes are high. USA Today reports:

The Teamsters Union is seeking to unionize the workers. It has demanded that Uber and Lyft turn over lists of drivers who meet the criteria set by the Seattle law, that they have driven at least 52 times in a three-month period in the proceeding year before Oct. 19, 2016.


Lyft was pleased the court ruled that what it called Seattle’s “experimental law” wouldn’t be implemented until issues raised by drivers are heard.

“The ordinance is a poorly drafted law that could undermine the flexibility of drivers to choose when, where and for how long they drive – the very things that make Lyft so attractive to drivers and useful for passengers,” said Adrian Durbin, Lyft’s director of communications.

Uber looks "forward to the court’s full consideration of the many serious legal questions about this ordinance as the lawsuit moves forward,” said Brooke Steger, general manager for the company in the Pacific Northwest.

The fight is not over though as GeekWire reports:

Last week, the U.S. Chamber of Commerce re-filed a lawsuit against the city of Seattle in U.S. District Court of Western Washington, arguing that the driver unionization ordinance violates federal labor laws related to independent contractors. In addition, the chamber pointed to a scenario where other cities will follow Seattle’s lead, creating a maze inconsistent of regulations for companies like Uber and Lyft to follow.

The next day, a group of 11 drivers announced to file its own lawsuit in federal court seeking to block the ordinance. The suit claims that Seattle’s law violates federal labor law as well as drivers’ First Amendment rights of free speech and freedom of association by forcing them to unionize and pay dues.

For the sake of opportunity and innovation, these on-demand and sharing economy companies deserve to prevail. People who use this technology as consumers benefit from more choice, better prices, and better services. Competition forces all companies to up their game if they want to attract customers.

Let's also not forget that women and men who want to earn extra cash or a living driving for Lyft and Uber enjoy the freedom to determine their schedules and what they earn. That flexibility is gone when collective bargaining enters the picture. They'll end up with collective mediocrity that doesn't reward effort or merit but simply showing up.