Uber and Lyft have agreed to pay a combined amount of $328 million to drivers, as they had withheld this money from them. New York Attorney General Letitia James said that this was the largest wage theft settlement that was procured by her office and that the ride hailing company had also agreed to an “earnings floor.”
News agencies Reuters and ABC reported that Uber and Lyft have to pay a fine of $328 million for charging drivers fees that were supposed to be paid by passengers. Uber will pay $290 million, while Lyft will pay $38 million to cheated drivers who have worked or are working for these ride-hailing companies. They will get back pay as well as mandatory paid sick leave and benefits they might have missed earlier.
Lyft released a statement that described the agreement as “historic” and said that it had built on what “drivers already enjoy through the state’s Black Car Fund.”
Jeremy Bird, who is the chief policy officer of Lyft said that the company is looking forward to providing “New York drivers the independence and full range of benefits available to those in other states, like California and Washington.”
Uber also released a statement describing the agreement as a “landmark” one.
The popular global ride hailing app added that they had been advocating from years that those drivers who chose their platform would “have both the ability to work when, where, and how often” they wanted, “as well as receive important benefits.”
The New York Attorney General’s office said Uber had misrepresented deductions that were made to the pay of its drivers as per its terms of service, and drivers had been “entitled to charge [the passenger] for any tolls, taxes, or fees incurred.” However, Uber never provided any method for drivers to charge these passengers through its app.
Lyft also shortchanged its drivers from 2015 to 2017 by deducting 11.5 percent as “administrative charge.” This is equal to the Black Car Fund fees and sales tax that had to be paid by riders.
Uber and Lyft did not provide sick leave to drivers. Employees are entitled to sick leave under New York City and New York State laws. Under the agreement, drivers of Lyft and Uber will get one hour of paid sick leave after 30 hours of work. They can work a maximum of 56 hours each year.
Uber and Lyft drivers are also under the “earnings floor” that guarantees a minimum rate of pay through the state. New York City drivers already receive a minimum rate of pay for drivers under 2019 regulations that were established by the Taxi & Limousine Commission
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