Uber sues Seattle over new law regulating how delivery platforms boot drivers off their apps

Uber is suing the City of Seattle over a new law, set to take effect in January, that regulates how companies can deactivate workers who deliver food, shop for groceries, and complete other tasks via on-demand apps.

The new law “forces Uber to associate with couriers whose presence on the platform undermines its commitments and reputation, and it substantially impairs Uber’s contractual relations with those couriers,” the lawsuit alleges.

The complaint, filed Wednesday in U.S. District Court in Seattle, is seeking an injunction blocking the new rules.

The law, originally passed by the Seattle City Council in August 2023 and signed at the time by Mayor Bruce Harrell, was designed to provide more job security to app-based couriers, delivery drivers, and other service providers.

In addition to Uber Eats and related courier services, it also applies to companies such as Instacart and DoorDash.

The legislation was the first of its kind at the time, and goes further than efforts by other municipalities to regulate deactivations.

The outcome of the lawsuit could impact the gig economy beyond Seattle by setting a precedent for how far cities can go in regulating the activities of app-based companies, and their relationships with workers.

Under the law, companies must give workers a 14-day notice of deactivation, base deactivations on “reasonable” policies, ensure human review of all deactivations, and provide workers with records behind the decision.

The law does not apply to drivers who transport passengers, who are covered under Washington state law.

Uber says the ordinance would force it to disclose confidential information, such as customer data and its fraud detection techniques. The company says this would endanger customer safety and make it easier for people to commit fraud. Uber also argues that the ordinance violates its First Amendment rights to free speech and free association.

“We have made repeated efforts to engage with the City on this ordinance since it was first introduced a year ago. Despite our best attempts to collaborate and offer constructive feedback, our concerns have been ignored,” an Uber spokesperson said in a statement.

Uber’s statement continued, “As a result, the final version of this law undermines our safety standards and raises significant privacy issues for our users—issues we cannot overlook. The decision to file suit was not made lightly, and we remain hopeful that the City will work with us on an acceptable path forward.”

The ordinance was supported by gig worker advocacy groups, who say that it will help to protect workers from being unfairly deactivated. They said companies had too much power to deactivate workers, leading to workers being unfairly punished for things like rejecting too many orders or being unavailable during certain times.

We’ve contacted the City of Seattle and Mayor Harrell’s office for comment.

Update: In a statement, Callie Craighead, a spokesperson for Mayor Harrell’s office, said: “Seattle is committed to remaining at the forefront of the strong worker protections needed for today’s modern gig economy. While we are unable to comment on the merits of pending litigation, the City will vigorously defend its laws from legal challenge. We defer any further comment to the City Attorney’s Office.” Editor’s note: the City’s Attorney Office declined to comment.

Update: Here’s a statement from DoorDash: “Seattle’s deactivations ordinance is one of several bad policies that have resulted from rushed and unnecessary legislative processes. While we are not a party to this lawsuit, we feel strongly that the law in question is seriously flawed and rules proposed by the city could make this policy even worse. We are watching this process closely and evaluating our next steps.”

Read the full text of the suit below.

Uber v. City of Seattle by GeekWire on Scribd