Uber and Lyft have agreed to pay a substantial settlement of $328 million to resolve allegations by New York’s attorney general that they were “stealing earnings” from drivers in the city. This announcement, reported by Shannon Thaler of the NYPost on 2nd Nov 2023, highlights a significant development in the ongoing scrutiny of ride-sharing companies’ labor practices.
The breakdown of the settlement reveals Uber’s contribution of $290 million and Lyft’s $38 million. This fund will cover back pay, paid sick leave, and various improvements in working conditions for drivers. More than 100,000 drivers in New York are eligible for these funds, with an average payout estimated at $3,280. However, drivers who began after 2017 are not included in these additional payments.
New York Attorney General Letitia James highlighted that the settlement concludes multi-year investigations into Uber and Lyft. These investigations revealed that both companies had withheld significant earnings and benefits from drivers. James emphasized the hardships faced by these drivers, many of whom belong to immigrant communities and rely heavily on these jobs for their livelihoods.
In response to the settlement, Uber outlined a new benefits model for drivers, emphasizing the balance of flexibility and new benefits such as a minimum earnings standard and paid sick leave. Lyft’s Chief Policy Officer, Jeremy Bird, also welcomed the settlement as beneficial for drivers and expressed a commitment to extending similar benefits to drivers in other states.
Drivers eligible for back pay are guided to submit their claims through Rust Consulting, a settlement consultation firm. The criteria for eligibility and the specific periods for Uber and Lyft drivers are detailed on the attorney general’s website.
The article also touches on concerns about how improved benefits might affect ride fares. Recent instances of surge pricing during emergencies in New York have already caused public frustration, with exorbitant prices reported during heavy rains and flooding. The impact of this settlement on ride prices remains an area of concern for consumers.
This settlement marks a significant step in addressing the long-standing issues related to driver earnings and benefits in the gig economy, particularly within the ride-sharing sector. It reflects a growing recognition of the rights and needs of gig workers and sets a precedent for similar actions in other regions and industries.