Uber and Lyft will pay their New York drivers a combined $328 million to settle claims the companies illegally deducted taxes and fees over multiple years, state Attorney General Letitia James’ office announced on Thursday.
The major agreements also require the two ride-share giants to offer paid sick leave to their drivers statewide, according to the terms of the deal that settles a state investigation into the companies’ tax-withholding practices.
As part of the settlement, Uber and Lyft drivers outside New York City will receive an “earnings floor,” or minimum per-ride rate — a version of which the city implemented in 2019.
All of the money in the settlements — $290 million from Uber and $38 million from Lyft — will go to people who drove for Uber from 2014 to 2017 and Lyft from 2015 to 2017.
James’ office announced the agreements’ terms on Thursday morning, calling the deal the largest wage-theft settlement in the office’s history.
In a statement, James said Uber and Lyft “systematically cheated their drivers out of hundreds of millions of dollars in pay and benefits.”
“These drivers overwhelmingly come from immigrant communities and rely on these jobs to provide for their families,” she said. “This settlement will ensure they finally get what they have rightfully earned and are owed under the law.”
Both Uber and Lyft denied any wrongdoing in the case and the companies praised the settlement as striking a good balance between driver flexibility and providing benefits.
“Choosing flexibility shouldn’t mean folks have to give up protections like sick pay and minimum earnings,” said Uber’s chief legal officer Tony West said in a prepared statement Thursday. “Today, Uber reached a landmark, first-of-its-kind agreement with New York Attorney General Letitia James, that gets us closer to achieving that goal.”
Lyft’s chief policy officer Jeremy Bird struck a similar note.
“This is a win for drivers, and one we are proud to have achieved with the…
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