It seems there is still a long road to go before Lyft can settle a dispute with drivers over proper worker classification. As Bloomberg reports, a federal judge rejected the company’s attempt to settle with drivers as being ‘glaringly inadequate.’
All told, Lyft tried to settle with $12.25 million — a measure that would only net drivers involved in the class action suit about $53 each. U.S. District Judge Vince Chhabria determined that the settlement way too low: only comprising about a tenth of the mileage reimbursement requested in the suit. That number doesn’t even factor in other costs associated with the suit.
A third of that settlement would go to lawyers’ fees.
Although this agreement was initially settled with drivers, the judge’s rejection will send both parties back to the drawing board.
Lyft has been given the offer to settle without reclassifying its drivers — while its competitor Uber will have to go to trial. Although this is ostensibly good news for one ridesharing company and not the other, there is still plenty to be decided regarding the gig economy and its treatment of employees.
In a survey done earlier this year by Intuit, the biggest problems drivers face are the predictability and consistency of work and money. Classifying workers at full-time takes a lot of these concerns out of the equation, as well as providing other benefits like health insurance.
Even if full-time classification is untenable, on-demand companies may be responsible at some point for things like overtime and reimbursement — which are significant parts of Lyft drivers’ complaints.