If approved, a settlement could provide limited compensation to the more than 250,000 drivers who worked for Uber and Lyft between 2016 and 2020.
California is purportedly in settlement negotiations with rideshare companies Lyft and Uber, which it claimed had unlawfully categorized drivers as independent contractors to avoid paying taxes and offering employment benefits.
According to The Los Angeles Times, the lawsuit was first filed in 2020. Now, years later, the state appears poised to enter settlement negotiations; drivers have asked that the California Attorney General’s Office and Department of Labor consider their concerns before approving a settlement.
If approved, a settlement could provide limited compensation to the more than 250,000 drivers who worked for Uber and Lyft between 2016 and 2020. On Wednesday, some of these drivers demonstrated outside of city halls in Los Angeles, San Diego, and San Francisco, asking that the state only accept a settlement that recovers all of their lost wages or, alternately, establishes pay raises and workplace protections for drivers.
“Our first priority is to get back the money that was stolen,” said Rideshare Drivers United president Nicole Moore. “The only way they should trade away any of that money is to get fair standards.”
Moore said that settlement negotiations could be leveraged to establish a sort of rate card, guaranteeing drivers a minimum rate of $1.75 per mile and $.60 cents per minute.
Zahid Arab, a spokesperson for Uber, said that the company is now working to resolve the case, noting that California in 2020 approved a law to let drivers continue working as independent contractors.
“Drivers come to Uber precisely because of the unique flexibility that it provides,” Arab told the Los Angeles Times in an emailed statement. “[…] The voters of California have spoken—overwhelmingly—and we look forward to putting these years-old matters behind us.”
Settlement negotiations, says the Times, currently involve the California labor commission—with whom drivers had filed wage-related complaints—as well as the state attorney general. The state, alongside city attorneys from Los Angeles, San Diego, and San Francisco, then filed a lawsuit asking that rideshare drivers be immediately recategorized as employees.
The lawsuit accused Uber and Lyft of misclassifying drivers as independent contractors, in part, to avoid paying local and state payroll taxes.
The Los Angeles Times further reports that many rideshare drivers now complain of deteriorating work conditions and decreased pay. One driver, 48-year Yasha Timenovich, told the Times that he started driving for Lyft in 2014. He works about twelve hours a day, seven days a week, but cannot afford to make ends meet.
Timenovich shared the example of a recent ride: the passenger paid $54.99, but Timenovich earned only $24.15 after Uber deducted $29.34 for “commercial auto insurance & other expenses,” $.10 for “taxes & gov’t fees” and a further $1.40 for Lyft’s own earnings.
“How do they justify this?” he asked. “What’s left for me?”
Sources
California in settlement negotiations with Uber, Lyft in massive wage-theft case
California in settlement talks with Uber, Lyft over wage theft claims
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