Drivers Cooperative-Colorado: Building a Social Co-op for Rideshare Drivers

Rideshare drivers, most of whom are gig workers—meaning they get paid per job rather than earn a regular wage—are among the nation’s most exploited workers. One powerful way to change this and support gig drivers is by creating a cooperative, specifically a social cooperative.

Social cooperatives share the same goal as other cooperatives, including following a principle of “one person, one vote” in organizational governance. They also adhere to a principle of solidarity—that all individuals support each other.

[A] unique feature of social cooperatives is their social mission.

But two things make social cooperatives unique from other cooperatives. One is their multistakeholder structure. Most co-ops have a single class of members. For example, a worker cooperative is typically comprised entirely of worker-owners. By contrast, a social cooperative involves at least two different classes of members: workers and nonworker supporters.

The second unique feature of social cooperatives is their social mission. While all cooperatives exist to benefit members, social cooperatives emphasize the “social” purposes of the cooperative—namely, advancing public good in the broader community. In co-op terms, they focus on the seventh principle of cooperation—concern for the community.

A Model Rooted in Immigrant Worker Power

Drivers Cooperative-Colorado (DCC), like its namesake in New York City, aims to put low-wage rideshare drivers in control of the app and of their own economic futures. DCC is, formally speaking, a multistakeholder limited cooperative association (LCA). In accordance with this model, both workers and the nonprofit I direct, the Rocky Mountain Employee Ownership Center (RMEOC), can become members. In short, both riders and community investors can come together to support a common enterprise.

Who are the driver co-op worker-members? Primarily, they are low-income, immigrant rideshare drivers that use principles of mutual aid to advance their wellbeing. The rideshare economy offers quick, accessible work that attracts many immigrant workers. Although there’s no reliable count of rideshare driver demographics in Colorado, studies in other states have consistently found that over half of rideshare drivers are immigrants. Uber and Lyft’s websites also claim that many of their workers are immigrants. Our own survey among Colorado rideshare drivers indicates that 70 percent of local rideshare drivers are immigrants from Africa, the Middle East, Asia, and Latin America.

Immigrants, of course, today face federal attacks in ways that are both intensified and yet hardly new. Immigrant power building takes many forms. But one of them is building immigrant workers’ economic capacity. The social cooperative structure helps immigrants by making it easier to earn a living and by creating businesses they own and control. At DCC, drivers take home 80 percent of each fare, while the same drivers only get 30 to 40 percent from corporate rideshare companies like Uber or Lyft.

Although Uber and Lyft lure these workers with promises of workplace independence, flexible schedules, and good pay, the reality is that the large commissions paid to Uber and other job costs (like gas and vehicle maintenance) mean that the effective hourly wage is low.

The root cause of this exploitation is an economic structure wherein large global companies (such as Uber) use platforms to extract high profits from workers who are treated as independent contractors, rather than employees with rights to minimum wage and fair labor standards, even as their every movement is watched from afar and subjected to intense forms of computer-aided supervision. In this situation, most rideshare drivers receive very low pay and are subject to frequent deactivation by their platform based on any rider complaint, often without due process.

In Colorado, more than 10,000 rideshare drivers work as full-time or part-time drivers but their hourly wage hovers between $5.49 and $10.50 an hour.

Currently, big platform companies operate with opaque algorithms and exploitative payment practices, generating immense profits for shareholders. Workers have no access to the innards of these proprietary apps and have little understanding, control, or voice in how algorithms are used to manage their work lives and earnings.

A 2020 survey from California found that 71 percent of app workers work 30 hours a week, and more than half work over 40 hours. Despite these long hours, the same survey found that 15 percent are forced to rely on public assistance, and 45 percent reported that they couldn’t handle a $400 emergency payment without borrowing.

In Colorado, more than 10,000 rideshare drivers work as full-time or part-time drivers but their hourly wage hovers between $5.49 and $10.50 an hour.

Making a Social Cooperative Work in Practice

The social co-op strategy aims to change industry practice by combining workers and supporters in a multistakeholder co-op structure; and by imbuing the partnership in a specific social mission that centers immigrant workers as leaders. The theory is good. But how is it implemented?

Among the many responsibilities that RMEOC, as a nonprofit member, takes on is to raise capital for the cooperative. RMEOC raised more than $500,000 just to launch the cooperative.

Technical support is also critical. The Co-op Drive app was officially launched in the fall of 2024 after two years of effort to raise seed funding, build an app, and create the co-op infrastructure. The role of RMEOC in supporting the coop at start-up and (as envisioned) over the next three years is similar to how governments in some countries, such as South Korea, provide seed funding support to public benefit social cooperatives for several years so that they build business skills and reach stability.

A third important role for RMEOC is to help the co-op develop partnerships with local nonprofit and governmental agencies to provide reliable and affordable transportation to specific groups of people needing ride-hailing services. These include people with brain injuries, previously incarcerated people, and people with low-incomes needing election-day transportation to the polls. All these populations need improved transportation access, which is part of DCC’s mission (and business model) to meet those social needs.

DCC aims to obtain more contracts with local government agencies to provide increased service to people with disabilities, people living on low incomes, and elderly people. To advance this work, DCC has provided a series of training sessions for members, teaching skills for how to reach out to various governmental and nonprofit organizations. Already, Denver’s Community Planning and Development department has authorized a contract to provide transportation support for low-income and senior residents in the Denver metro area. As the Denver area Regional Transportation District has given a contract to Uber for almost $9 million a year for transporting such populations, our goal is to seek similar contract support from additional governmental agencies and departments.

In short, DCC is much more than a rideshare platform. Although serious challenges remain, such as revising and upgrading the functionality of its app, DCC is hopeful that, over time, it can expand the scope of its operations.

Advancing Social Cooperatives as Policy

Unfortunately, the US legal and political system has yet to recognize the substantial public benefits that could be achieved by formally recognizing social cooperatives. While many countries—including Canada, Italy, and South Korea—have established rules governing “social cooperatives,” including having supportive policies such as preferential procurement rules, favorable taxation regimes, and dedicated grants, in the United States, the concept of social cooperatives has not yet been formally recognized.

Despite this, de facto social cooperatives in the United States are proliferating. At this moment, rideshare drivers are working to launch drivers’ cooperatives in multiple US cities. If these efforts succeed, over time, the various co-ops might even link with each other to form a nationwide federation of drivers.

Contracts…can help these social cooperative efforts reach the scale needed to be sustainable.

State and local government leadership in recognizing social cooperatives—and supporting them with local policy and funding—can advance an increasingly powerful strategy. This support begins with legal recognition of the social cooperative business form. Then, it can expand to dedicated grants, preferential procurement, contracts with public agencies to provide services, and tax incentives.

Contracts, in particular, like those that have been developed in Denver, can help these social cooperative efforts reach the scale needed to be sustainable. Ultimately, there is the potential to change the ride-hailing model into one where workers exercise a large measure of control and earn a much larger share of the ride-hailing fare.

Entrepreneurial energy—among immigrants, in communities of color, and among workers more broadly—abounds. Social cooperatives—in ride-hailing and elsewhere—have a valuable role to play.

RMEOC incubated DCC as a conscious strategy to build one self-sustaining social cooperative. But there is a broader potential for hundreds or thousands of similar projects nationwide. At a moment when federal agencies are under threat, it is high time for state and local leaders to embrace social cooperatives and related community self-help, grassroots models.