Background
In 2020, the Attorney General's Office, representing the Commonwealth of Massachusetts, filed a lawsuit in Suffolk Superior Court seeking a determination that Uber and Lyft drivers are employees under Massachusetts Wage and Hour Laws and therefore entitled to basic benefits and protections.
On June 27, 2024, the Attorney General’s Office entered into a settlement agreement with Uber and Lyft which resolved the Office’s multi-year litigation against the companies and put a stop to the threat of the companies’ attempting to rewrite state employment law via a 2024 ballot initiative which would have resulted in drivers receiving inadequate protections and an earnings standard that would not guarantee minimum wage.
The agreement requires the following:
- Drivers receive a minimum of $32.50 per hour for time spent traveling to pick up riders and transporting them to their destination, adjusted annually for inflation, ensuring for the first time that the tens of thousands of Uber and Lyft drivers in Massachusetts will be guaranteed minimum pay.
- Uber to pay $148 million, and Lyft to pay $27 million for a combined $175 million, most of which will be distributed as restitution to current and former drivers who were underpaid by the companies. More information about who qualifies for these payments and how to file a claim will be publicly announced by the Attorney General’s Office in the coming weeks.
- Drivers receive guaranteed paid sick leave, earning one hour of sick pay for every 30 hours worked, up to a maximum of 40 hours per year. As part of the agreement, Uber and Lyft must update their driver applications so drivers are able to view and claim their sick leave directly in the app.
- Drivers receive a paid stipend to buy into the state’s paid family and medical leave program.
- Pooled health insurance benefit. For the first time anywhere, Uber and Lyft will allow drivers to pool their hours driving for the two companies to obtain access to a health insurance stipend. Anyone who drives for more than 15 hours per week—for either or both companies—will be able to earn a health insurance stipend to pay for a plan on the Massachusetts Health Connector.
- Drivers are eligible for occupational accident insurance paid by the companies for up to $1 million in coverage for work-related injuries.
Additionally, provisions in the agreement dictate that the companies:
- Provide drivers with information about the length of a trip, the destination, and the expected earnings before they are expected to accept a ride.
- Provide drivers with detailed pay information about their earnings and how much a rider has paid once a trip is completed.
- Cannot discriminate against drivers based on race, religion, national origin, sex, sexual orientation, gender identity, disability or other protected characteristic.
- Cannot retaliate against drivers who have or are perceived to have filed a complaint about the companies with the Attorney General’s Office or sought payment or other benefits under today’s settlement.
- Must offer drivers in-app chat support with a live person in English, Spanish, Portuguese, and French.
- Must perform an annual audit and provide detailed information about compliance with the terms of the settlement agreement to the Attorney General’s Office.
- Must provide drivers with information about why they have been deactivated and create an appeals process that allows drivers to challenge the deactivation.
- Must provide the Attorney General’s Office with the information it needs to ensure compliance.
The agreement also details a process to address any violations by either company, including a process for the companies to address any driver complaints to the Attorney General’s Office, and enforcement by a court if the companies don’t comply.
Resources
The case is known as Attorney Gen. v. Uber Technologies, Inc., Suffolk Superior Ct. Docket No. 2084CV01519-BLS1, and filings are available through masscourts.org
Several key filings are linked below:
- Complaint
- Joint Pretrial Filing
- Attorney General’s Proposed Findings of Fact — Uber
- Attorney General’s Proposed Conclusions of Law — Uber
- Uber’s Proposed Findings of Fact
- Attorney General’s Proposed Findings of Fact — Lyft
- Attorney General’s Proposed Conclusions of Law — Lyft
- Lyft’s Proposed Findings of Fact
- Settlement Agreement
FAQ
What is the settlement?
- In 2020, the Attorney General filed a lawsuit against Lyft and Uber to obtain wages, benefits and other protections for Uber and Lyft drivers. The companies agreed to a settlement with the Massachusetts Office of the Attorney General (OAG) to resolve the lawsuit.
- The settlement does two main things:
- It provides at least $140 million in back pay to drivers who used the Uber and Lyft Driver apps to provide rides to passengers in Massachusetts between July 14, 2020 and July 2, 2024.
- It also provides new benefits to all current drivers who use the Uber and Lyft Driver apps to provide trips to passengers. These benefits will be available through the Uber and Lyft Driver apps.
What new benefits will current drivers receive?
- New benefits include the following:
- A minimum “earnings floor” of $32.50 per hour of engaged time, beginning August 15, 2024. Engaged time is the time between when a driver accepts a rider’s requested trip in the Uber or Lyft app and when the driver drops the rider off. This includes the time the driver spends driving to the pick-up destination, waiting at that location, and transporting the rider to the drop-off location.
- The earnings floor will increase annually by 3% or the rate of inflation, beginning January 2025.
- Written notification of deactivation with information about why a driver was deactivated as well as the right to appeal any deactivation, beginning September 2, 2024
- Occupational accident insurance paid by the companies for up to $1 million in coverage for work-related injuries, beginning October 1, 2024
- Statements that explain drivers’ earnings and how much riders paid for a ride, beginning October 1, 2024
- Guaranteed paid sick leave, beginning November 1, 2024
- An automatic stipend, included in drivers’ pay, to cover the cost of buying in to the state’s paid family and medical leave program, beginning January 30, 2025
- Access to a health insurance benefit, beginning March 1, 2025
- In-app chat support for Lyft and Uber in English, Spanish, Portuguese and French, beginning July 2, 2025
- Immediate access to protections against discrimination, retaliation and protected domestic violence leave
Do I qualify for settlement payments?
- If you completed rides using the Uber or Lyft Driver app between July 14, 2020 and July 2, 2024, you may qualify. The Attorney General’s Office is still working out criteria for payments that are fair and meaningful.
- Settlement payments will not be made until after January 1, 2025, the date by which Uber and Lyft must make their payments to the Attorney General.
- More information will be provided soon about the process for disbursing settlement payments.
What is the minimum earnings floor for drivers?
- Prior to the settlement, Uber and Lyft did not guarantee drivers a minimum earnings amount. As a result of the settlement, drivers who give rides in Massachusetts are now entitled to a minimum hourly pay. Beginning August 15, 2024, Lyft and Uber will ensure drivers receive a minimum of $32.50 per hour of engaged time. Here are some important points:
- Lyft or Uber will ensure all drivers receive at least the minimum earnings amount per hour by using an “earnings floor.” This earnings floor starts at $32.50 per hour of engaged time.
- Drivers will be paid the minimum pay for “engaged time.” Engaged time is all of the time between when a driver accepts a ride and when a driver drops off the rider. This includes the time spent driving to pick up a rider, the time spent waiting for a rider at the pick-up location, and the time spent driving the rider to the drop-off location.
- For each two-week earnings period, Lyft or Uber compares the average amount per hour drivers have earned against the earnings floor. If a driver has earned less than the earnings floor, Lyft or Uber must pay the driver the difference between the driver’s actual earnings and the earnings floor. Lyft or Uber will pay the driver no later than the next earnings period. Any tips that a driver earns will go to the driver and are not counted by Uber and Lyft as part of a driver’s earnings toward the earnings floor.
- The earnings floor increases for each year, beginning on January 15, 2025. The amount of the increase is the lower of (i) a 3 percent annual rate; or (ii) the average inflation rate for the preceding calendar year as reflected in the U.S. Bureau of Labor Statistics Consumer Price Index for Wage Earners (“CPI-W”) for the Northeast Region. It may also be increased if the state minimum wage increases.
What is paid sick leave?
- Beginning November 1, 2024, drivers will earn one hour of sick pay for each 30 hours of engaged time. Drivers can earn a maximum of 40 hours of sick time per year with each company.
- Engaged time begins when a driver accepts a rider’s request in the Lyft or Uber driver app, and end when the rider is dropped off at their destination.
- Sick leave is earned at $20 per hour.
- The sick-leave rate will increase for inflation each year, beginning on January 1, 2025, using the lower of (i) a 3 percent annual rate; or (ii) the average inflation rate for the preceding calendar year as reflected in the U.S. Bureau of Labor Statistics Consumer Price Index for Wage Earners (“CPI-W”) for the Northeast Region. It may also be increased if the state minimum wage increases.
- More information about this benefit will be provided to eligible drivers in the app no later than December 15, 2024.
How can I claim paid sick leave?
- Lyft and Uber are updating their driver apps to manage sick leave. Drivers will be able to see how much sick leave they have collected to date, as well as claim paid sick leave beginning November 2, 2024.
What qualifies for paid sick leave?
- Sick leave can be use it for any of the reasons listed below. You can take sick leave for yourself, or to care for your child, spouse, parent, or spouse's parent.
- Drivers can request sick leave for:
- Mental or physical illness, injury, or health condition (you do not have to have a diagnosis or require medical care when you request leave)
- Diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or a need for medical diagnosis or preventive care
- Absence from work when you or your child has been the victim of domestic violence.
What is required in the deactivation process?
- Beginning September 2, 2024, drivers will receive written notification of deactivation with information about why a driver was deactivated as well as the right to appeal any deactivation.
- Drivers will be able to appeal all Lyft or Uber decisions to deactivate that driver.
What earnings information will Lyft and Uber provide?
- Lyft and Uber will provide earnings statements for each trip that show how much the driver has earned and how much a rider has paid for each ride.
What trip information will Lyft and Uber provide?
- Beginning September 1, 2024, when a driver is offered a trip in the app, the notification to the driver must include the estimated travel time and number of miles and the estimated earnings for the trip.
- Beginning October 1, 2024, within 24 hours of the completion of a trip, the driver will receive an electronic statement showing for the trip:
- the total amount of time;
- the total mileage driven
- the total Earnings payable to the Driver; and
- the amount the rider paid for the trip.
How are Lyft and Uber changing chat support?
- By July 2, 2025, in-app live chat support for drivers will be available in English, Spanish, Portuguese and French.
- Drivers will be able to chat with live Lyft or Uber personnel through the apps. These representatives will be familiar with relevant Lyft or Uber policies in order to provide drivers with accurate information.
What is the Paid Family Medical Leave Stipend?
- Beginning January 30, 2025, Lyft and Uber will pay half the independent contractor rate for Paid Family Medical Leave (0.44% of earnings, excluding tips), to every driver, on a quarterly basis or sooner, so that drivers can opt-in to the state Paid Family Medical Leave program if they choose to do so.
- For more information about Paid Family Medical Leave, visit: https://www.mass.gov/info-details/paid-family-and-medical-leave-coverage-for-self-employed-individuals
What discrimination protections apply?
- Lyft and Uber shall not engage in any discrimination against drivers or prospective drivers on the basis of protected characteristics against which employers are prohibited from discriminating pursuant to G.L. c. 151B.
What benefits will be provided through Occupational Accident Insurance?
- Beginning October 1, 2024, Uber and Lyft will pay for Occupational Accident Insurance for all drivers for up to $1 million in coverage for work-related injuries.
What is the health stipend?
- Beginning March 1, 2025 drivers will be eligible for a health insurance benefit.
- This health benefit allows drivers to pool their hours driving for the two companies to obtain access to a health insurance stipend. Anyone who drives for more than 15 hours per week—for either or both companies—will be able to earn a health insurance stipend to pay for a plan on the Massachusetts Health Connector.
What are the protections for domestic violence leave?
- Lyft and Uber must allow drivers up to 15 days unpaid leave for these purposes:
- seeking or obtaining medical attention, counseling, victim services or legal assistance;
- securing housing;
- obtaining a protective order from a court;
- appearing in court or before a grand jury;
- meeting with a district attorney or other law enforcement official;
- attending child custody proceedings; or addressing other issues directly related to the abusive behavior against the employee or family member of the employee.
What are the protections against retaliation?
- Lyft and Uber will not in any manner retaliate against any Drivers on the basis that they have cooperated or are perceived to have cooperated with the Attorney General or have complained or made claims under the agreement.