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posted by Fnord666 on Monday March 20, @03:09AM   Printer-friendly
from the still-not-employees dept.

CNET reports

The showdown between ride-hailing service Lyft and its California drivers appears to have come to an end.

US District Judge Vince Chhabria gave final approval on [March 16] to a $27 million settlement agreement for a class-action lawsuit between Lyft and more than 200,000 of its former and current California drivers, according to court filings.[PDF]

This settlement seems to conclude the battle over how the ride-hailing company classifies its drivers. Under the agreement, the drivers will remain independent contractors, rather than be converted to employees.

[...] While Lyft's settlement seems to close the debate over driver classification, things could still change.

"The agreement is not perfect," Chhabria wrote in his order on Thursday. "And the status of Lyft drivers under California law remains uncertain going forward."

[Ed note - This story vandalized by Fnord666]

El Reg continues

The drivers sued Lyft in 2013 arguing that they should be classified as employees rather than independent contractors--the same issue that has dogged rival Uber in courts around the country.

By classifying drivers as independent contractors, Lyft and Uber shift the expense of payroll taxes, overtime, and worker benefits to drivers. With lower operating costs and venture funding, they are able to offer transportation at a price that's often below what taxi companies can afford to charge.

The settlement provides drivers with greater protection against being removed from the Lyft platform. Lyft has agreed to alter its Terms of Service so that it can no longer deactivate driver accounts for any reason. Instead, it will enumerate specific infractions that may lead to termination.

It will also pay for driver arbitration costs in the event of a dispute, and implement a pre-arbitration process to resolve issues without entering into a more formal process.

What's more, the settlement calls for creating a way for passengers to "favorite" a driver, resulting in benefits of some sort. And Lyft has agreed to provide more passenger data to drivers before they have accepted ride requests.

The settlement, however, leaves issues of employment classification unresolved.

In April last year, US District Judge Vince Chhabria of San Francisco rejected a proposed $12M settlement on the grounds that drivers might win more than 10 times that amount were a jury to determine Lyft's drivers should be designated employees.

In accepting the revised offer, Chhabria acknowledges that the compromise leaves issues unresolved. "The agreement is not perfect," he wrote in his order [PDF] approving the settlement on Thursday. "And the status of Lyft drivers under California law remains uncertain going forward. But the agreement falls within a range of reasonable outcomes, given the benefits it achieves for drivers and the risks involved in taking the case to trial.".


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  • (Score: 2, Interesting) by ben_white on Monday March 20, @03:33AM (2 children)

    by ben_white (5531) on Monday March 20, @03:33AM (#481348)

    With lower operating costs and venture funding, they are able to offer transportation at a price that's often below what taxi companies can afford to charge.

    This isn't accurate. In most markets Uber is 10-30% more expensive than comparable taxi service. The real business model here is to shift costs to the driver (or avoid costs altogether by ignoring regulations taxis have to follow). This allows for extraction of higher profits to the owners of the company. The gig economy at its best.
    --
    cheers, ben

    • (Score: 1) by khallow on Monday March 20, @06:11AM (1 child)

      by khallow (3766) Subscriber Badge on Monday March 20, @06:11AM (#481376) Journal

      In most markets Uber is 10-30% more expensive than comparable taxi service.

      Not seeing it [businessinsider.com].

      The column labeled "Taxi/Uber" shows the taxi fare relative to the Uber fare. If the ratio is over 1, as it is everywhere except New York and Philadelphia, that means that Uber is cheaper than a cab — that is, until surge pricing reaches that level. In L.A., an Uber car is cheaper for this sample trip even with surge pricing up to 1.7x.

      The base rate for Uber is better than taxis in most US cities in the above survey. I think you're talking about surge pricing, which for Uber is much more expensive in general, but then nobody is claiming it'll be cheaper in that situation. You'll pay either way, more money for an Uber ride and a longer wait for a taxi ride (particularly, if the taxi is serving Uber riders first!).

      The real business model here is to shift costs to the driver (or avoid costs altogether by ignoring regulations taxis have to follow). This allows for extraction of higher profits to the owners of the company. The gig economy at its best.

      The rider is the one who pays for the business model, not the driver. These complaints ignore the considerable popularity of ride sharing businesses in a number of cities.

      • (Score: 0) by Anonymous Coward on Monday March 20, @08:32AM

        by Anonymous Coward on Monday March 20, @08:32AM (#481402)

        Perhaps ben_white is always dialing a ride at peak hours (when the gig economy jacks up its prices).

        -- OriginalOwner_ [soylentnews.org]

  • (Score: 1, Insightful) by Anonymous Coward on Monday March 20, @04:12AM (1 child)

    by Anonymous Coward on Monday March 20, @04:12AM (#481357)

    US District Judge Vince Chhabria gave final approval on [March 16] to a $27 million settlement

    Under the agreement, the drivers will remain independent contractors, rather than be converted to employees.

    Looks like you've got a lot of independent contractors there. It'd be a shame if we started calling them employees.

    I'm sorry Don Gov. I forgot to make a donation to the family charity this month. Here's $27 million.

    Getting harder to tell the difference between the gov and the mafia with each passing day.

    • (Score: 1, Informative) by Anonymous Coward on Monday March 20, @08:24AM

      by Anonymous Coward on Monday March 20, @08:24AM (#481400)

      The $27M was NOT a fine from a criminal court.
      CA.gov or USA.gov got none of the money.
      It was a settlement to a tort.
      The money went to the 200,000 drivers.

      -- OriginalOwner_ [soylentnews.org]

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