California Judge Denies Lyft's $12.25M Driver Settlement

Rival Uber agrees to $10M background checks settlement

By Andrew Peeling Apr 8, 2016

A California judge rejected ride-hailing company Lyft's $12.25 million settlement of a class-action lawsuit, saying the settlement "shortchanged" its drivers.

U.S. District Judge Vince Chhabria was likely referring to the estimated $126 million the drivers involved in the lawsuit would have been entitled to based on data provided by the company, Reuters reported.

The lawsuit was brought in 2013 by California drivers who believed they should be classified as employees and therefore entitled to reimbursement for expenses. Lyft agreed to settle the lawsuit in January, but the settlement did not include the reclassification of its drivers.

Lyft competitor Uber on Thursday agreed to a $10 million settlement after California prosecutors alleged the company misled passengers about the quality of its driver background checks, the Associated Press reported.

Federal judge rejects $12.25 million settlement in Lyft driver lawsuit
U.S. District Judge Vince Chhabria said in a San Francisco court filing that the amount "does not fall within the range of reasonableness." (Reuters)

Uber Appeals Ruling that Driver Was Employee
The debate over whether ride-booking service Uber’s drivers are employees or independent contractors is revving up. (SHRM)

The bullet that Lyft just dodged is still coming for Uber
Lyft will not have to reclassify its drivers as employees after reaching a settlement in which it agreed to pay extra in compensation and benefits, though the amount is still being debated (Note: this article was published prior to the judge overturning the settlement amount). Uber is facing a similar lawsuit from its drivers, but a quirk in the litigation could make the outcome way worse for the world's biggest ride-hail company. (The Verge)


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