The New York Attorney General Letitia James announced two landmark settlement agreements, totaling $328 million dollars with rideshare companies Uber and Lyft for wage theft. The settlements resolve multi-year investigations into Uber and Lyft, which found that the companies’ policies withheld hard-earned pay from drivers and prevented them from receiving valuable benefits available under New York labor laws. The settlements announced today will return $328 million in back pay to drivers and institute a minimum driver “earnings floor,” paid sick leave, proper hiring and earnings notices, and other improvements in drivers’ working conditions. Uber will pay $290 million and Lyft will pay $38 million to current and former drivers.
“For years, Uber and Lyft systematically cheated their drivers out of hundreds of millions of dollars in pay and benefits while they worked long hours in challenging conditions. These drivers overwhelmingly come from immigrant communities and rely on these jobs to provide for their families. These settlements will ensure they finally get what they have rightfully earned and are owed under the law. My office will continue to make sure that companies operating in the so-called ‘gig economy’ do not deprive workers of their rights or undermine the laws meant to protect them.” Said the Attorney General.
In addition to paying a total of $328 million in back pay to former drivers, Uber and Lyft have agreed to an “earnings floor,” guaranteeing drivers across the state are paid a minimum rate from dispatch to completion of the ride. Drivers outside of New York City will receive a minimum of $26 per hour, adjusted annually for inflation, ensuring for the first time that the thousands of Uber and Lyft drivers working primarily outside of New York City will be guaranteed minimum pay. Drivers operating in New York City already receive minimum driver pay under regulations established by the Taxi & Limousine Commission (TLC) in 2019.
Uber and Lyft drivers will now also receive guaranteed paid sick leave. Drivers will earn one hour of sick pay for every 30 hours worked, up to a maximum of 56 hours per year. Drivers completing rides outside of New York City will be paid a minimum of $26 per hour for sick leave, adjusted annually for inflation. To reflect the New York City minimum driver pay rules that already include an amount for paid time off, drivers completing trips covered by the TLC minimum driver pay rules will be compensated at $17 per hour for sick leave, adjusted annually for inflation. Uber and Lyft will also make updates to their apps to allow drivers to request sick leave through the apps.
Uber and Lyft will also begin to provide drivers with proper hiring notices and earning statements, notify drivers after each ride the amount paid by the rider, update the app to include in-app chat support for drivers in multiple languages, and allow drivers to appeal deactivations from their platforms.
More than 100,000 drivers throughout New York stand to receive settlement funds and the benefits afforded to them under these historic settlements. As a result, these agreements will have a major impact on the economic lives of rideshare drivers, who are predominantly immigrants and often the main source of income for their families. Surveys have shown that in New York City, nine out of ten drivers are immigrants, two-thirds work full-time as drivers, and more than half are the primary breadwinners in their households.
If you believe you are victim of wage theft, please contact the attorneys at Pechman Law Group at 212-583-9500. We have recovered over 30 million dollars on behalf of workers who have been cheated out of their overtime or have been subjected to other unlawful pay practices.