Massachusetts Uber and Lyft Drivers to Receive Highest Wages in Historic Settlement
Introduction
Uber and Lyft drivers in Massachusetts are set to receive among the highest wages in the US for ride-share workers, following a historic settlement with Massachusetts prosecutors.
Settlement Details
State Attorney General Andrea Campbell and the two ride-share companies have agreed to a $175 million settlement. The agreement mandates a minimum pay floor of $32.50 per hour and introduces new benefits and protections for drivers. The resolution ends four years of litigation, with Uber contributing $148 million and Lyft $27 million to the settlement, most of which will be distributed as restitution to current and former underpaid drivers. Details on how to file claims will be released soon.
Benefits and Protections
The agreement guarantees drivers in Massachusetts, for the first time, a minimum pay, paid sick leave, occupational accident insurance, and healthcare stipends. Drivers working at least 15 hours per week will be eligible for up to 40 hours of paid sick leave annually and a stipend for health benefits.
Drivers’ Reactions
Ed Booth, a Lyft driver for over seven years, often earns more than the new wage floor, depending on demand. He welcomes the health insurance benefits but is wary of increased competition. Lyft’s Jeremy Bird hailed the settlement as a “huge win” for drivers, emphasizing the flexibility it provides.
Company Responses
Uber’s Chief Legal Officer Tony West highlighted the agreement as a model for dignified, independent, flexible work. Both Uber and Lyft will continue operations in Massachusetts, with the new terms effective from August 15 and adjusted annually for inflation.
Mixed Reactions
Henry De Groot, co-founder of Massachusetts Drivers United, sees the settlement as a significant victory for drivers but is disappointed that it doesn’t address driver classification. Drivers will be paid the minimum of $32.50 per hour when en route to pick up or transport passengers, though some drivers expressed concerns about unpaid time spent logged into the app without ride requests.
Health Insurance and Appeals Process
Drivers working over 15 hours per week will receive a stipend to buy into the state’s health insurance plan. The settlement also introduces an appeals process for drivers to contest deactivations.
Conclusion
The lawsuit, initially filed by then Attorney General and now Governor Maura Healey in 2020, aimed to secure fairness for drivers by challenging their classification as contractors. Healey praised the settlement as a historic step towards correcting past injustices.