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Lyft is avoiding a tiral with $27 million settlement

Why doesn’t Lyft, or Uber for that matter, want to classify full-time workers as employees?

Last Thursday in San Francisco, U.S. District Judge Vince Chhabria gave the 27 million dollar deal offered by Lyft preliminary approval. Previously, Lyft offered $12.5 million to full-time drivers, who want the rights and benefits of employees, in hopes of keeping them classified as independent contractors. However, Chhabria ruled that wasn’t enough reparation in April. Lyft INC. is avoiding what could be a long trial and more monetary compensation by offering the $27 million.

 

“Chhabria concluded that the payout for drivers in the earlier settlement proposal didn’t account for the company’s skyrocketing growth through the middle of February. He figured that if the drivers had won at trial, the actual value of the reimbursement they sought for mileage and expenses would have been at least $126 million and that other potential claims might make the case worth about $170 million”. Reports Joel Rosenblatt of Bloomberg.
Uber is also waiting for a similar deal for $100 million to be approved at the same courthouse.

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