Uber and Lyft settled a yearslong legal dispute with the legal professional common in Massachusetts on Thursday, agreeing to pay their drivers within the state a minimal price with some advantages.
As a part of the settlement, Uber and Lyft can pay $175 million to resolve claims that the businesses violated state labor legal guidelines, with a lot of the cash to be distributed to gig staff, state officers mentioned in an announcement. However in a win for the ride-hailing corporations, drivers will proceed to be categorised as unbiased contractors and never workers.
Among the many advantages that the state gained for its gig staff had been a medical health insurance plan for drivers working at the least 15 hours per week, expanded accident insurance coverage and a minimal pay price of $32.50 per hour for time spent on a journey.
The settlement adopted related pay and profit provisions enacted in New York, California, Washington State and most not too long ago Minnesota. Uber and Lyft have spent tens of hundreds of thousands of {dollars} on native authorities lobbying in opposition to efforts by staff and labor teams to extend driver pay.
“For years, these corporations have underpaid their drivers and denied them primary advantages,” mentioned Andrea Pleasure Campbell, the legal professional common of Massachusetts. “As we speak’s settlement holds Uber and Lyft accountable, and gives their drivers, for the very first time in Massachusetts, assured minimal pay, paid sick go away, occupational accident insurance coverage and well being care stipends.”
The lawsuit in opposition to Uber and Lyft was first filed in 2020 by Maura Healey, the earlier legal professional common.
In separate statements, Uber and Lyft mentioned that the settlement was a win for his or her drivers, and that sustaining unbiased contractor standing was essential for flexibility.
“This settlement is an instance of what unbiased, versatile work with dignity ought to appear to be within the twenty first century,” Tony West, Uber’s chief authorized officer, mentioned in an announcement.
“We’re thrilled to succeed in an settlement that works for everybody, and builds on related progress we’ve made in states like New York, California, Minnesota and Washington,” mentioned Jeremy Chook, Lyft’s government vp of driver expertise.
On account of the settlement, each corporations will keep away from a possible Massachusetts poll initiative struggle over driver classification in November.