Two popular ride-hailing companies Uber and Lyft have agreed to pay a total of $328 million to resolve a lawsuit in New York State. They were accused of denying their drivers wages and benefits, including sick leave. This agreement assures that over 100,000 present and past drivers will be compensated.
As part of the agreement, drivers in New York will now have guaranteed minimum wages and sick leave. Additionally, both companies are required to establish a support channel within their apps to address driver concerns about earnings and working conditions.
Uber will pay the lion’s share, contributing $290 million, while Lyft will pay $38 million. It’s important to note that neither company admits wrongdoing in this settlement. However, Uber has expressed its commitment to improving conditions for drivers. They believe drivers should have the freedom to choose their work hours without losing essential benefits.
Under the settlement, Uber drivers in New York will earn a minimum of $26 per hour when they pick up or drop off passengers. They will also be entitled to 56 hours of paid sick leave each year and receive paid training and app education.
“The agreement is a win for drivers across New York State who can now enjoy both the flexibility that is so important to them, while also having new benefits and protections like a minimum earnings standard and paid sick leave,” Uber said in a press release.
The company hopes this settlement will set a precedent for other states to consider treating drivers as full-time employees rather than independent contractors.
Lyft also considers this a “win” and plans to continue working toward providing New York drivers with more benefits and independence.
This settlement comes after a lengthy investigation by the New York Attorney General’s office, revealing that both Uber and Lyft had allegedly withheld driver pay and denied drivers certain benefits, as required by New York state labor laws. Uber’s alleged violations took place from 2014 to 2017, and Lyft’s from 2015 to 2017.
The New York Attorney General, Letitia James, stressed that this settlement is significant for drivers who rely on these jobs to support their families. She stated, “This settlement will ensure they finally get what they have rightfully earned and are owed under the law.”
