Massachusetts Uber And Lyft Drivers Win Big: $32.50 An Hour Pay, Benefits After $175M Settlement

Uber will pay the majority of the hefty settlement, giving $148 million to underpaid drivers.

Uber and Lyft drivers in Massachusetts are getting a serious pay raise. The rideshare companies must now offer benefits and implement a pay rate of $32.50 an hour to its contracted workers.

Starting Aug. 15, rideshare drivers will receive $32.50 an hour due to an $175 million settlement initiated by the state. Massachusetts Attorney General Andrea Campbell first sued Uber and Lyft four years prior, alleging that they were underpaying drivers and denying them employee benefits they had a right to.

The litigation finally resolved this June. It now enforces new regulations for Uber and Lyft to provide a livable wage to their independent contractors. Campbell referred to the settlement as holding the rideshare companies “accountable” for the livelihoods of their drivers.

“For years, these companies have underpaid their drivers and denied them basic benefits. Today’s agreement holds Uber and Lyft accountable, and provides their drivers, for the very first time in Massachusetts, guaranteed minimum pay, paid sick leave, occupational accident insurance, and health care stipends,” said AG Campbell. “I want to thank my team, whose hard work has secured a standard of dignity for every driver across the state, and our labor allies and the drivers themselves for the tireless work and advocacy.”

Uber will pay the majority of the hefty settlement, giving $148 million to Lyft’s $27 million. The money will distribute to all underpaid drivers, including current and former ones. Moreover, drivers will receive guaranteed paid sick leave and a pooled health insurance benefit. They will also get a paid stipend to buy into the state’s paid medical and family leave program.

The state’s governor, Maura Healey, also congratulated AG Campbell for delivering a “historic” settlement that betters the lives of employees.

“Our lawsuit against Uber and Lyft was always about fairness for drivers. I congratulate Attorney General Campbell and her team for securing this settlement that delivers historic wages and benefits to right the wrongs of the past and ensure drivers are paid fairly going forward,” said Healey.

Furthermore, Uber and Lyft cannot retaliate or discriminate against drivers who may have filed a complaint against their practices. They will now have to perform an audit while ensuring the implementation of these new policies.