From PC World: Lyft has agreed to pay $27 million to settle a dispute with drivers in California, under pressure from the judge who found the earlier proposed payment of $12.25 million was too small.
The ride-hailing company and its rival Uber Technologies are keen to settle with the drivers in class-action lawsuits, without having to agree to their reclassification as employees, which would push up their costs.
The companies currently classify their drivers as independent contractors, which does not require them to pay the drivers benefits such as reimbursement in work-related expenses.
A filing by the lawyer for the drivers in another lawsuit in a California court suggests that Uber could have to pay over $700 million in mileage expense reimbursement and phone expenses between 2009 and April of this year, if its drivers in California and Massachusetts were classified as employees. Uber has contested the figure.
A current settlement proposal, which still needs the approval of the judge, would require Uber to pay the drivers $84 million with a subsequent top-up of $16 million depending on the company’s valuation if it goes public.
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