Uber and Lyft will pay drivers a combined $328 million as part of a settlement that the companies unlawfully withheld pay and benefits including paid sick leave in New York state. As part of the settlement, New York drivers for the ride-hailing companies are now guaranteed minimum hourly wages, and paid sick leave, and will require the company to address any questions about earnings and working conditions in an in-app support channel.
Attorney General Letitia James announced that Uber will pay $290 million while Lyft will pay $38 million, with more than 100,000 current and former drivers qualifying to receive benefits and funds from the settlement. Both companies reportedly denied any wrongdoing in the settlement, but Uber issued a press release saying it has worked to “change the status quo” for drivers, and they should be able to choose when, where, and how often they work without having to give up benefits they would otherwise qualify for.
As part of the settlement, Uber drivers will earn a minimum of $26 per hour when picking up or dropping off a rider, will receive 56 hours of paid sick leave per year, and will get paid driver training and education on the app.
“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 the press release. The company added that it hopes the settlement will pave the way for other states to treat drivers as full-time employees rather than contractors and shows “when we work together with legislators and regulators, we can resolve these issues in a way that benefits workers and consumers alike.”
Lyft also referred to the agreement as a “win.”
“New York has long been a leader in providing drivers portable benefits through flexible earning opportunities with its Black Car Fund, and this agreement expands upon that foundation,” said Jeremy Bird, Lyft’s chief policy officer. “We look forward to continuing this work in order to provide New York drivers the independence and full range of benefits available to those in other states, like California and Washington.”
The settlements follow a years-long investigation by the state attorney general’s office into Uber and Lyft’s practices which revealed the companies withheld driver’s pay and blocked drivers from receiving certain benefits available under New York state labor laws. Uber’s alleged violations took place from 2014 to 2017 and Lyft’s occurred from 2015 to 2017.
“For years, Uber and Lyft systematically cheated their drivers out of hundreds of millions of dollars in pay and benefits while they worked long hours in challenging conditions,” Attorney General James said in a statement accompanying the announcement.
“These drivers overwhelmingly come from immigrant communities and rely on these jobs to provide for their families,” James added. “This settlement will ensure they finally get what they have rightfully earned and are owed under the law.”
Uber and Lyft did not immediately respond to Gizmodo’s request for comment.
