California Judge approves Lyft Settlement covering $27 Million

Company - Pavan Pandey - Mar 17,2017

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california judge approves lyft settlement covering dollar 27million

According to court filings, Vince Chhabria, a United States District Judge, gave his ultimate authorization to the $27 million settlement against Lyft.

On Thursday, in San Francisco, a United States judge gave final authorization to a settlement arrangement in a lawsuit against transportation network company, Lyft Inc.

The Lyft settlement keeps chauffeurs as independent workers. 

The drivers of Lyft Inc. in California had sued the company, arguing they should be categorized as staffs of the company and hence be eligible for reimbursement for expenses which comprises maintenance of vehicle along with gasoline. In California, drivers are currently paying these types of charges on their own.

In his final order, Judge Chhabria notified, "The agreement is not perfect.” He further added that the grade of Lyft car drivers under California regulation remains uncertain going forward.

Another US-based transportation network company, Uber Technologies Inc. faces a similar class-action lawsuit from its drivers in Massachusetts and California. A settlement agreement in that case of Uber valued at up to $100 million, which was rejected by a judge last year, who believed settlement agreement was insufficient for the drivers.

According to statistics, Lyft Inc. has more than 700,000 drivers countrywide, while its major rival, Uber, has nearly 1.5 million drivers worldwide. If both of these companies had to reclassify their drivers as an employee then the valuations and profits would brutally affect them.

Last year in the month of January, Lyft agreed to resolve an offered class-action suit in California by offering company’s driver some benefits such as workplace protection but still not agreeing to categorize the drivers as an employee of the company.

The current settlement arrangement will preserve drivers the flexibility to select where, when and for how long they drive with the company, a spokeswoman from Lyft Inc. said.