Uber Settles Class-Action Lawsuit for $20 Million

Credit: Newsy Studio
Published 5 days ago - Duration: 01:15s

Uber Settles Class-Action Lawsuit for $20 Million

In the lawsuit, drivers in California and Massachusetts claim Uber classifies them as independent contractors to get out of providing benefits.

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Uber Settles Class-Action Lawsuit for $20 Million

Uber has agreed to a  $20 million  settlement in a yearslong legal battle over its policy of classifying drivers as independent contractors.  The lawsuit was  originally filed  in 2013 and later granted class-action status.

In it, drivers in California and Massachusetts claimed the ride-sharing company was classifying them as freelancers as a way to get out of providing benefits and paying them a minimum wage.

Uber offered in 2016 to settle the suit for as much as $100 million — so long as it could continue to classify the nearly 400,000 drivers as independent contractors.

But a judge  rejected the settlement , claiming the amount was "not fair, adequate, and reasonable." Since then, the number of drivers taking part in the suit has decreased  to about 13,600 .

That's because an appeals court ruled some of the litigants had to go through arbitration instead of having their claims heard in open court.

The attorney representing the drivers in the case estimates each would receive  roughly 37 cents  for each mile they've driven for Uber under the terms of the new agreement.

As of Wednesday morning, the settlement still needed to be approved by the judge.

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