Lyft Agrees To $27 Million Settlement To Keep Drivers As Independent Contractors

Image courtesy of Lyft

Last month, the judge rejected a proposed settlement in a class action against ride-hailing app Lyft, saying that the $12.25 million offer was too low and didn’t account for business expansion in California since the original class action was filed. The company has now agreed on a revised settlement, pending the judge’s approval.

The new settlement offer is $27 million — again, this is only for drivers in California. That could mean payments of thousands of dollars to busy veteran drivers for the service, but the key part of the agreement is that drivers will remain independent contractors.

Like the settlement with competitor Uber, though, concessions from the ride-hailing app include a promise to no longer deactivate (fire) drivers with no explanation or recourse.

Drivers who have been part of Lyft for six months or more would receive an estimated average of $8,000, while newer drivers would receive an average of $6,000, according to the drivers’ attorney. The same attorney represented drivers for Uber in their similar lawsuit, which also resulted in a cash settlement and drivers not earning employee status.

Lyft Agrees to $27 Million Settlement With Drivers [Wall Street Journal]

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