Uber And Lyft Massachusetts drivers will soon see their wages increase. The state’s attorney general has won a lawsuit that would have raised the state’s minimum hourly wage to $32.50, according to the Associated Press.
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Massachusetts Attorney General Andrea Campbell led the lawsuit on behalf of the state, which will receive $175 million in combined funds from Uber and Lyft. Campbell accused both companies of violating state labor and wage laws, the AP reported. The “vast majority” of the multimillion-dollar settlement will go to current and former drivers.
“For years, these companies have underpaid their drivers and denied them basic benefits,” AG Campbell said in a statement. “Today’s settlement holds Uber and Lyft accountable and provides their drivers, for the first time in Massachusetts, with guaranteed minimum wages, paid sick leave, workers’ compensation insurance, and health care benefits.”
How will Massachusetts drivers benefit?
The settlement announced Thursday (June 27) also targets other rights and protections for drivers.
For example, drivers will now receive one hour of sick pay for every 30 hours worked and can track and request sick leave in their app. Both companies will also offer subsidies to help drivers purchase state paid family and medical leave.
The new agreement will also benefit drivers who work for both ride-sharing companies. For example, a driver who works 15 hours or more a week with Lyft, Uber, or both will be eligible for health insurance subsidies to pay for the Massachusetts Health Connector.
Another benefit is that it allows drivers to view important information, such as trip length, destination, and expected earnings, before accepting a ride. Additionally, companies must provide in-app support for drivers in English, Spanish, Portuguese, and French.
If either company deactivates a driver’s account, they must notify the driver why and create an appeals process.
Uber & Lyft Release Statement on Massachusetts Settlement
Both ride-sharing companies issued statements following last week’s ruling. Uber acknowledged that the deal was “an example of what independent, flexible and dignified work looks like in the 21st century.”
“In seizing this opportunity, we have addressed historical liabilities by building a new operating model that balances flexibility and benefits. This allows both Uber and Massachusetts to move forward in a way that reflects what drivers want and demonstrates to other states what is possible,” the company also said.
Lyft also accepted the minimum wage terms, calling it a “historic” change for “correct the mistakes of the past and ensure drivers are paid fairly in the future.”
“More importantly, this is a major victory in a years-long campaign by Bay State drivers to ensure their independence while still enjoying new benefits,” Lyft said.
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