BOSTON, Massachusetts – Rideshare drivers in Massachusetts are set to receive groundbreaking benefits and a minimum hourly pay of $32.50 starting on August 15th, thanks to a recent settlement between the state and rideshare giants Uber and Lyft. This move comes four years after Attorney General Andrea Campbell filed a lawsuit against the companies, arguing that their drivers should be classified as employees under state law.
As part of the settlement, Uber and Lyft have agreed to pay a total of $175 million, with a significant portion allocated to compensate current and former drivers who were found to have been underpaid by the companies. Although drivers will still be classified as independent contractors, they will now be entitled to yearly pay raises based on inflation, as well as various employee benefits including sick leave and healthcare stipends.
In addition to the pay raises and benefits, drivers will also have the opportunity to earn up to 40 hours of paid sick leave annually, at a rate of $20 per hour. Uber and Lyft will further support their drivers by providing stipends for healthcare expenses and assisting them in enrolling in the state’s family and medical leave program. Furthermore, the companies have committed to covering work-related injuries to ensure the well-being of their workforce.
To guarantee compliance with the terms of the agreement, Uber and Lyft will be required to conduct regular audits and submit reports to the Attorney General’s office. Any violations of the settlement could result in penalties and fines as outlined in the published terms of the agreement. The state’s initiative aims to set a precedent for fair labor practices within the rideshare industry, prioritizing the welfare of drivers while maintaining the flexibility of independent contractor status.