In early 2020, thousands of Uber and Lyft drivers, supported by the advocacy group Rideshare Drivers United, filed claims against the companies, alleging misclassification as independent contractors and demanding over $1.3 billion in wages, expenses, and damages. The California attorney general, labor commissioner, and city attorneys of Los Angeles, San Diego, and San Francisco joined in a coordinated lawsuit, seeking to enforce state labor laws and hold the companies accountable. Drivers who worked between 2016 and 2020 could be eligible for a potential settlement, as negotiations are now underway, with mediation sessions scheduled with Uber and Lyft in the coming weeks.
The drivers are advocating for a fair settlement that includes full repayment of lost wages or significant improvements in pay and workplace protections. Rideshare Drivers United has proposed a rate card system similar to New York City’s, which guarantees drivers a minimum of $1.75 per mile and 60 cents per minute. These demands come as part of a broader effort to ensure companies are held accountable for alleged wage theft.
Uber and Lyft, however, have argued that most drivers prefer the flexibility of independent contractor status and claim that enforcement of wage laws would harm the industry’s growth. In 2020, the companies secured the passage of Proposition 22, which allowed them to classify drivers as independent contractors instead of employees. Although the ballot initiative was upheld by the state Supreme Court, California’s legal battle against Uber and Lyft continues. The outcome of the current settlement negotiations could set a significant precedent for gig economy labor rights and corporate accountability.
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