Victory for rideshare drivers
New York Attorney General Letitia James announced on Thursday a historic settlement totaling $328 million with industry giants Uber and Lyft. The settlements stem from multi-year investigations revealing that both companies had deprived drivers of rightful earnings and benefits, impacting thousands of hardworking individuals.
The investigations found that between 2014 and 2017, Uber and Lyft had deducted sales taxes and Black Car Fund fees from drivers' payments, which should have been paid by passengers. Uber also misrepresented deductions in drivers' pay, misleading them about charges incurred. Lyft employed a similar tactic, deducting administrative charges equal to the amount of sales tax and fees due from riders.
Under the terms of the settlements, Uber will pay $290 million, and Lyft will pay $38 million. The funds will be distributed as back pay to over 100,000 current and former drivers. Additionally, both companies have agreed to implement significant improvements in drivers' working conditions. While New York City drivers already receive minimum pay, the settlements ensure drivers outside the city will earn a minimum of $26 per hour. Furthermore, all drivers will now receive guaranteed paid sick leave, earning one hour of sick pay for every 30 hours worked, up to 56 hours per year.
Attorney General James emphasized the significance of this settlement, stating, "For years, Uber and Lyft systematically cheated their drivers out of hundreds of millions of dollars in pay and benefits. This settlement will ensure they finally get what they have rightfully earned and are owed under the law."
Uber's Chief Legal Officer, Tony West, praised the agreement, emphasizing its benefits for drivers. "This helps put to rest the classification issue in New York and moves us forward with a model that reflects the way people are increasingly choosing to work," West stated. Lyft's Chief Policy Officer, Jeremy Bird, echoed this sentiment, calling the agreement a "win for drivers" and pledging to continue working towards providing New York drivers with comprehensive benefits.
The settlements mark a significant step toward securing fair treatment and adequate compensation for rideshare drivers, underscoring the importance of protecting workers' rights in the evolving gig economy.