In a significant move that has pitted the Minneapolis City Council against Mayor Jacob Frey, a veto-proof majority of the council members voted 9-4 on Thursday to approve a pay increase for rideshare drivers. The approved measure includes minimum pay scales and other protections aimed at ensuring drivers earn the equivalent of the city's $15.57 hourly minimum wage.

While Uber and Lyft have vehemently opposed the pay increase, stating that it would necessitate a significant hike in fares and ultimately lead to a collapse of their business model, supporters argue that it is necessary to address the issue of underpaid workers in the rideshare industry. Organized groups of drivers and labor advocates have rallied behind the council's decision, considering it a victory for the city's workforce.

However, Mayor Frey wasted no time in pledging to veto the pay increase. His veto, though, could be overruled by the veto-proof majority if the vote holds. But if the council does override the veto later this month, both Uber and Lyft have stated that they will cease operations in the city, potentially affecting the entire state, on May 1, the day the pay increase is set to take effect.

Uber and Lyft are currently the only two rideshare companies licensed to operate in Minneapolis, although several other entities have expressed interest in entering the market. The business community, restaurant associations, and some members of the disability community have voiced their opposition to the plan, citing concerns over increased costs for consumers and potential limitations on accessible transportation.

The council's decision came just before a state report was set to be released, which could shed light on the rates necessary for drivers to earn specific earnings. The report, eagerly anticipated by both sides, was expected to play a crucial role in informing the debate around driver pay.

While the drivers' sentiment on the pay increase remains divided, with some expressing concerns about the potential impact on their earnings, others applaud the council for addressing the disparity between the income earned by drivers and the profits made by rideshare companies.

The approved plan guarantees a minimum payment of $1.40 per mile and 51 cents per minute, with wheelchair-accessible vehicle drivers earning $1.81 per mile. The council-approved measure also includes a $5 minimum payment for any ride, annual increases for drivers, and limits on how money can be deducted from drivers' wages.

Proponents of the council's plan have noted that adjustments to the rates before their implementation on May 1 could be made. However, opponents argue that the council should have waited for the forthcoming statewide report commissioned by Governor Tim Walz, which would provide comprehensive data on the rideshare industry in Minnesota.

As tensions escalate between the city council and the rideshare companies, Uber has indicated its intention to seek preemption of the city's ordinance through state law, potentially opening the door for a return in the future.

The fate of the pay increase now lies in the hands of the council members as they navigate the contentious landscape surrounding rideshare regulation and seek to address the concerns of both drivers and the rideshare companies.