A federal judge has tentatively accepted an improved $27 million settlement between California drivers and ride-sharing firm Lyft to resolve claims the drivers should have been treated as employees, rather than contactors.
The original proposed settlement of $12.25 million was rejected by U.S. District Judge Vince Chhabria, but with a new plan that more than doubled the original offer, he gave tentative approval Thursday.
Under the current terms, drivers are still treated as independent contractors, not employees, and do not receive reimbursement for work-related costs like gas, insurance and other expenses.
“The new proposed settlement agreement fixes the monetary flaws the court previously identified and enhances the nonmonetary benefits at least to some degree,” Chhabria wrote. He said the deal was “fair and reasonable.”
The nonmonetary improvements include extending the optional pre-arbitration process to all drivers, even those deactivated. Lyft also agreed to be regulated as a transportation carrier or provider of taxi service. Not groundbreaking, but they do improve the value of the settlement somewhat, the judge said.
Case: Cotter v. Lyft Inc, No. 13-cv-4065
