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Lyft doubles its settlement with California drivers to $27 million

Lyft doubles its settlement with California drivers to $27 million


Lawsuit will mean drivers remain classified as contractors, not employees

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Lyft has agreed to more than double its settlement in a class action lawsuit in California after a judge rejected a $12.25 million deal as too small. Drivers for the service argued that they'd been misclassified as independent contractors, rather than employees, and are set to receive $27 million under the revised settlement. This is roughly 17 percent of the $156 million sum that attorneys say the drivers could have recovered had they been recognized as employees. Under the terms of the deal, Lyft's drivers will remain independent contractors.

The settlement echoes a similar deal between Uber and its drivers in California and Massachusetts. In that case, the potential damages were $852 million, reports Reuters, but the taxi company will instead be paying out a sum of up to $100 million. As with the Lyft settlement, the Uber drivers will remain independent contractors, and in both cases, the settlements await a judge's approval.

Drivers who worked more than six months could receive more than $6,000

Drivers involved in the cases will be reimbursed on a sliding scale based on how much time they've worked for the companies. In a statement about Lyft's California lawsuit, the drivers' attorneys said individuals who had worked more than six months for the company "could receive more than $6,000," while those who had worked only "a few days" would receive payments closer to $25.

"We are proud to have reached this new agreement, which will provide significant payments to Lyft drivers who have put a lot of their time into this company," said the drivers' attorneys, Shannon Liss-Riordan and Matthew Carlson. "Once again, although the agreement does not resolve for the future the question of whether Lyft drivers should properly be classified as employees or independent contractors, we believe this agreement provides a fair resolution of this case [and] will get money into the pockets of drivers now."