Lyft’s deal to settle a lawsuit by drivers alleging misclassification as independent contractors received preliminary approval last Thursday by federal Judge Vince Chhabria, according to court records.
The settlement calls for Lyft to pay drivers $27 million and make other changes. However, it leaves the drivers’ status as independent contractors — not employees.
A previous settlement deal that called for Lyft to pay $12.25 million to drivers had been rejected by the judge because it underestimated the value of the drivers’ claim for reimbursement.
“The new settlement agreement in the Cotter case adequately addresses the flaws identified in the court’s prior ruling,” according to the ruling. “The parties have increased the total settlement amount from $12.25 to $27 million, primarily to account for the error made by plaintiffs’ counsel in estimating the value of the reimbursement claim.”
The Los Angeles Times reports [1] that Lyft spokesperson Chelsea Wilson said, “we are pleased the court has granted preliminary approval of the settlement, which maintains the classification of drivers as independent contractors and brings us one step closer to a final resolution.”
Separately, another lawsuit alleging independent contractor misclassification of drivers was filed against Uber. The new lawsuit filed Friday seeks to represent current and former drivers in Wisconsin, according to court records.
Other lawsuits have also been filed against Uber after the company’s recently announced settlement [2] of up to $100 million for drivers in California and Massachusetts. The Milwaukee Journal Sentinel reports at least two dozen other lawsuits [3] around the country have also been filed.
The named plaintiff in the new Wisconsin suit is Lamont Lathan, and the lawsuit seeks class action status.
“This is a suit brought on behalf of all current and former Uber drivers in Wisconsin asking the court to properly classify Wisconsin Uber drivers as employees as opposed to their current misclassification by Defendants as independent contractors, to recover unpaid overtime wages and compensation, as well compensation, including overtime wages for hours worked but not recorded or paid (“off-the-clock” work), reimbursement of all expenses incurred in performing their work as Uber drivers, and payment of all gratuities that were earned but stolen by Uber or were lost due to Defendants’ communications and policies,” according to the Wisconsin suit.