HF 2369

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/16/2023 05:39pm

A bill for an act
relating to labor; establishing protections for transportation network company
drivers; proposing coding for new law as Minnesota Statutes, chapter 181C.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

[181C.01] DEFINITIONS.

(a) For the purposes of this chapter, the following terms have the meanings given.

(b) "Deactivation" means the suspension or termination of a driver's ability to receive
connections to potential riders, packages or related services from a transportation network
company.

(c) "Digital network" means any online-enabled application, software, website, or other
system offered or utilized by a transportation network company that enables the
prearrangement of rides or delivery of packages by transportation network company drivers.

(d) "Prearranged ride" or "ride" and "prearranged package delivery" or "delivery" means
the provision of transportation by a driver to a rider or a package, beginning when driver
accepts a request to transport the person or package through a digital network controlled
by a transportation network company, continuing while the driver transports the rider or
package, and ending when the last requesting rider or package departs the vehicle.

(e) "Transportation network company" or "TNC" means a corporation, partnership, sole
proprietorship, or other entity that provides transportation services in this state and that uses
a digital network to connect TNC riders or package deliveries to TNC drivers who provide
prearranged rides or prearranged package delivery. A TNC does not include taxicabs,
limousines, for-hire vehicles, or a private passenger vehicle driven by a volunteer driver.

(f) "Transportation network driver" or "driver" means an individual who receives
connections to potential riders, packages, or related services from a TNC in exchange for
payment.

Sec. 2.

[181C.02] OBLIGATIONS AND DUTIES; INSURANCE REQUIREMENTS.

A TNC must:

(1) provide insurance that fully covers any injuries sustained by a driver while the driver
is picking up or transporting passengers or packages, driving between transporting riders
or packages, or waiting to receive from the TNC a new contact to transport riders or packages.
The insurance shall be payable to the driver or to the driver's beneficiaries. This insurance
must give coverage to a driver at least equal to that provided under workers' compensation
insurance as allowed under chapter 176; and

(2) provide all insurance necessary for the protection of the transporting vehicles and
of passengers or third parties while the driver is picking up or transporting passengers or
packages, driving in between pickups, or waiting for a new contact from the TNC for the
transport of riders or packages. This insurance must also cover all types of injuries or
damages required by the insurance laws of this state for vehicles engaged in transporting
packages, including as required under chapter 65B.

Sec. 3.

[181C.03] MINIMUM COMPENSATION.

(a) All fees provided in this section must be calculated on a per-trip basis and may not
be combined.

(b) Minimum compensation paid by a TNC shall be as follows:

(1) at least $2.55 per mile and 65 cents per minute to all drivers for the time transporting
a passenger or package, unless surge or other enhanced billing is in effect, in which case
the driver shall also be paid 85 percent of any additional fee or fare charged to the rider or
package sender on top of their regular mile and minute fees paid on a per-trip basis;

(2) a $10 cancellation fee when a cancellation occurs after the driver has already departed
to pick up the rider or package;

(3) $1.25 per mile and 20 cents per minute if a driver must drive more than five miles
to pick up a person or package or for the next pickup while a driver is traveling empty to
pick up the passenger or package. Upon pickup, compensation shall revert to the
compensation under clause (1); and

(4) a minimum fee of $6.50 for any transport of a rider or package to a driver.

(c) A TNC that uses its software or collection technology to collect fees or fares, whether
the fees or fares are actually collected, must still pay a driver the fees or fares earned by the
driver.

(d) A TNC must provide to the applicable driver all tips that a passenger or sender of
packages provides within one week following the ride or package transport.

(e) Beginning July 1, 2024, and each July 1 thereafter, the fares and fees provided in
this section are subject to an automatic annual adjustment equal to the cost-of-living
percentage published by the United States Department of Labor.

Sec. 4.

[181C.04] REIMBURSEMENT OF COSTS.

(a) A TNC shall pay reimbursement of costs as follows:

(1) ten cents per mile for fuel or energy costs and all tolls or fees required to make the
trip when a driver is driving to pick up, transporting, or waiting to pick up packages or riders
for all assigned trips by the TNC;

(2) 31 cents per mile for wear and tear on the vehicle used to transport riders or packages
for the use of the driver's own vehicle. This figure shall be automatically adjusted whenever
the Internal Revenue Service indicates an adjusted amount per mile for business use of
vehicles to half that per-mile amount;

(3) if circumstances require the use of a truck or specialized vehicle, the rate per mile
shall be 25 percent above the amount for vehicles; and

(4) the purchase of any vehicle equipment recommended or required by the TNC.

(b) A TNC may not receive any compensation from a car rental company or other product
provided to a driver.

Sec. 5.

[181C.05] DEACTIVATION.

(a) A TNC must have clear written rules stating the circumstances under which a driver
may be deactivated or sanctioned, either permanently or temporarily. These rules and any
updates must be available both online and in written form to the drivers at least 30 days
before they are enforceable.

(b) Deactivation for more than three days may only be as a consequence of a major
infraction that occurred while driving. The circumstances constituting a major infraction
must be clearly stated in the rules and are limited to driving while impaired; reckless or
careless driving; unprovoked assault; theft; sexual, racial, or other illegal harassment initiated
by a driver; and any felony committed by a driver while driving.

(c) Infractions that are not a major infraction cannot be combined to cause a deactivation
of more than three days unless the driver establishes a clear pattern of disregard for the
interest of passengers or the obligations of the driver after at least three written warnings
about the behavior.

(d) A TNC must provide the driver and the driver resource center with a written account
of the basis for any proposed deactivation or other sanction, including the rule or rules the
TNC claims have been violated. The driver must have the opportunity to present their
position and any other relevant information or witnesses regarding the alleged infraction
prior to deactivation or a sanction being imposed. The TNC must consider the information
provided by the driver. The burden of persuasion for any rule violation is more likely than
not and must be based on substantial, credible evidence. For a deactivation to occur it must
be a reasonable action based on the totality of the circumstances. A decertification hearing
must occur within ten days of a TNC becoming aware of an alleged violation. A traffic
ticket or other traffic or criminal charge is not conclusive evidence of a violation unless
there has been a conviction.

(e) A hearing must occur prior to any deactivation or other sanction being applied, except
that a TNC may temporarily deactivate a driver for a major infraction that endangers public
safety. In such instances, if the violation is not substantiated, the TNC must immediately
reinstate the driver. If no hearing occurs within the required time period, and no continuance
is agreed to, the alleged claim of a violation must be dismissed and cannot form the basis
of any further deactivation or other sanction.

(f) If the TNC deactivates a driver, gives a suspension of more than ten days, or if multiple
deactivations exceeding 15 days to a driver occur in a two-year period, the driver may appeal
to the Office of Administrative Hearings (OAH) using the contested case procedure under
chapter 14. The OAH may order that the deactivation be stayed until the hearing. This
provision does not affect layoffs for economic reasons that are not targeted at a particular
driver or drivers.

(g) Any driver who has been deactivated by a TNC since January 1, 2019, has the right
to a hearing, consistent with the procedures provided in this section, to determine if there
was a valid basis for the deactivation. If a valid basis is not established consistent with this
section, the driver must be reinstated. A driver who has previously been deactivated may
reapply for driver status and the application must be reviewed consistent with this chapter.

(h) By August 1, 2023, a TNC must provide notice of a right to a hearing to all drivers
deactivated since January 1, 2019, by contacting the drivers through the following means:

(1) emailing notice to the last known email address;

(2) texting to the last known cell phone number;

(3) providing a written notice to the last known home address; and

(4) calling the last known phone number of the deactivated driver.

Notified deactivated drivers will have 90 days to request a hearing. If a driver requests a
hearing, the procedures contained in this section apply to that process.

Sec. 6.

[181C.06] RETALIATION PROHIBITED.

A TNC may not retaliate against or discipline a driver for making a complaint, pursuing
enforcement of the terms of this chapter, joining with other drivers to discuss or address
concerns, or otherwise engaging in public discourse or expressing opinions regarding their
relationship with a TNC.

Sec. 7.

[181C.07] EQUAL ACCESS TO TRANSPORT.

A TNC may not use assignment of rides or deliveries to favor or disfavor any driver for
any reason. The assignments must be on a nonpreferential basis. A TNC must not withhold
or change assignments to a driver because a driver refused potential dispatches. All dispatches
must be made on a driver-neutral basis. A TNC is prohibited from promising preferential
treatment in rider or package delivery assignments if a driver agrees to refrain from joining
an organization of drivers or for any other reason.

Sec. 8.

[181C.08] DISCRIMINATION PROHIBITED.

A TNC may not discriminate against any of its drivers, applicants to become drivers,
riders, potential riders, package delivery customers, potential customers, or service receivers
due to race, national origin, color, religion, age, gender, disabilities, sexual orientation, or
gender identity. Nothing in this language prohibits providing reasonable accommodations
to people with disabilities, for religious reasons, due to pregnancy, or to remedy previous
discriminatory behavior.

Sec. 9.

[181C.09] CIVIL ACTION.

(a) A driver or a driver's beneficiaries may bring a civil action for damages for
noncompliance or a violation of this chapter against a TNC in district court.

(b) A prevailing plaintiff is entitled to three times the damages suffered. This includes
but is not limited to damages for failure to provide the required insurance, which shall be
at least equal to the cost of that insurance, plus any benefits that were not obtained as a
result of the insurance not being in force; any income lost or expenses not paid; damages
for emotional distress; and any other harm that resulted directly or indirectly from the failure
to comply with this chapter. Injunctive relief may also be sought and granted. A prevailing
plaintiff is entitled to reasonable attorney fees, costs, and expenses.

(c) A $1,000 penalty for each violation may be issued to the TNC and made payable to
the injured party.

(d) The statute of limitations on any such complaint is three years from the date of
discovery of the last instance of the violation affecting the complaining party.

Sec. 10.

[181C.10] REVOCATION OF LICENSE.

Failure to comply with the requirements of this chapter subjects a TNC to revocation of
any license and right to operate issued by a local unit of government. The commissioner of
labor and industry may initiate a revocation or limitation of license proceeding with a local
unit of government providing TNC licenses based upon a failure to comply with this chapter.

Sec. 11.

[181C.11] TRANSPARENCY.

(a) When a TNC alerts a driver of a possible assignment to transport a rider or package,
the TNC must indicate the number of miles and likely travel time from the driver's current
location to the pickup. The TNC must separately indicate the length and likely travel time
of the trip.

(b) Within 24 hours of each trip completion, the TNC shall transmit an electronic receipt
to the driver containing the following information for each unique trip or portion of a unique
trip:

(1) the date, location, total distance traveled, and time spent from acceptance of the
assignment to its completion;

(2) the time taken and total distance traveled from pickup to drop-off of the rider or
package;

(3) an itemization of the total fare or fee paid by the passenger;

(4) the total compensation to the driver specifying the rate or rates of pay, the rate per
minute, rate per mile, any applicable price multiplier or variable pricing policy in effect,
tip compensation, and a specifically itemized list of all costs and reimbursements to, or
charged to, the driver; and

(5) any other information necessary to implement this chapter.

(c) On a weekly basis, the TNC shall provide a written notice to each driver containing
the information required in paragraph (b), in a cumulative format for the week.

(d) Each driver must be provided with a detailed and itemized explanation communicated
either in writing or electronically of how the driver's compensation is calculated. The
communication must specify:

(1) all factors that impact a driver's compensation or reimbursement; and

(2) on average, the percentage of the total collected fees and costs incurred by the TNC
that are allocated to the drivers.

(e) Any changes in the criteria, formula, or method of calculating the total compensation
to drivers must be provided to drivers in writing at least 30 days prior to taking effect.

Sec. 12.

[181C.12] COLLECTIVE BARGAINING AGREEMENTS; EMPLOYMENT
STATUS.

Nothing in this chapter prohibits collective bargaining or is a basis to conclude whether
a driver is an employee or independent contractor.

Sec. 13.

[181C.13] DRIVER CONTRACT REQUIREMENTS.

A copy of this chapter must be attached to every driver contract for drivers in this state.
The rights and remedies established in this chapter are not required to be pursued through
arbitration and shall be at the election of the driver. Contracts that have already been executed
must have an addendum provided to each driver that includes a copy of this chapter and
notice that a driver may elect to pursue the remedies provided in this chapter, rather than
through arbitration. For cases that go to arbitration, the rights and damages that drivers are
entitled to in an arbitration proceeding shall be as provided in this chapter.

Sec. 14.

[181C.14] DRIVER RESOURCE CENTER.

Subdivision 1.

Selection; purpose.

(a) The commissioner of labor and industry shall
facilitate the creation of a driver resource center to assist in implementing the goals and
purposes of this chapter. The commissioner shall select the organization to oversee and
administer the center.

(b) The driver resource center shall provide the following services:

(1) outreach and education to TNC drivers regarding their rights and obligations under
this chapter and the applicable labor standards to support their ability to perform TNC driver
services;

(2) consult with drivers facing deactivation or other sanctions or violations of this chapter;

(3) educate drivers regarding other applicable federal, state, and local laws and regulations
related to their role as drivers;

(4) culturally and linguistically appropriate services, outreach, and education; and

(5) assist in ensuring the purposes of this chapter are fulfilled.

Subd. 2.

Administration.

(a) The driver resource center shall be administered by a
nonprofit organization that is, or is affiliated with, an organization with experience advocating
for the civil and economic rights of drivers, including those from disadvantaged
socioeconomic groups.

(b) Neither the driver resource center nor the organization administering the center may
be funded, influenced, or controlled by a TNC.

Subd. 3.

TNC agreements.

A TNC must enter into an agreement with the driver resource
center regarding the driver deactivation hearing process provided under section 181C.04.
Other issues may be included in the agreement. Any agreement must be approved by the
Department of Labor and Industry.

Subd. 4.

Funding.

Beginning September 15, 2023, TNCs shall collect 25 cents from
each trip or portion of a trip and transfer all funds collected from the 25 cents per trip
remittance to the driver resource center fund. The remittance under this subdivision is a
pass-through from passengers and shall not be considered TNC funds, nor funding by the
TNCs of the driver resource center. The remittance must be collected from each individual
trip or shared trip. All remittances collected in a month must be tendered to the fund by the
15th day of the following month.

Subd. 5.

Fund created.

A driver resource center fund account is created in the special
revenue fund in the state treasury. Funds collected from the remittance described in
subdivision 4 shall be deposited in the fund. Money in the account is appropriated to the
commissioner of labor and industry to support drivers through the driver resource center.

Subd. 6.

Reporting.

The entity selected as administrator of the driver resource center
shall submit a monthly accounting of funds expended and the purpose for the expenditure
and provide all other relevant accounting documents to the commissioner of labor and
industry. Upon verification, the commissioner shall disburse funds within 15 days of receipt
of the accounting invoice to the driver resource center.