Abstract
In May 2024 the State of Minnesota adopted a statewide minimum compensation standard for transportation network company (TNC) drivers, following the models in place in New York City and Seattle. In a report we conducted for the state, we used trip and compensation data for all of 2022 to analyze driver activity and compensation levels in relation to time worked and driver expenses, as well as the number of hours and miles TNC drivers accumulate per week, disaggregated by wait time, dispatch time and ride time. We also estimated the extent of “multi-apping,” i.e., drivers providing trips for both TNC companies. Our proposed core compensation standard would allow drivers to earn the equivalent of the state and local minimum wages for employees after covering all vehicle expenses; our alternative formulation included benefits.
We also considered how the proposed standards would affect access, availability and costs of rides, and provide comparisons between the adopted Minnesota pay standard and those existing in New York City, Seattle, and the rest of Washington State. On an after- expense basis, the Minnesota pay standard will increase hourly pay from an average of $12.34 to a minimum of $18.13. Effective implementation will require regular monitoring and review to make adjustments if the balance of driver supply and consumer demand deviates from the baseline conditions prevailing in 2022. Going forward, the state needs to require regular reporting of unadjusted company data to ensure effective monitoring and enforcement.