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Uber Class Action Lawsuits Reach Settlements

| Apr 27, 2016 | Employment Law |

Have you ever wondered if Uber drivers were considered employees of Uber? This is a question that was part of a major class action lawsuit in California and Massachusetts. Employee misclassification is an important issue because if an employee is misclassified, he or she could be missing out on health insurance, retirement and other employee benefits. This is exactly why Uber drivers in these class action lawsuits brought forth their claim.

While Uber claimed that its drivers were independent contractors (in a general sense this means a worker who is not entitled to benefits), many drivers thought otherwise. Likely in an effort to stop the bleeding quickly, Uber settled both class action lawsuits in California and Massachusetts.

The settlement agreement (with specific stipulations laid out) included a $100 million payout to 385,000 plaintiffs listed in the class action lawsuits. Some of the specifics of this agreement include allowing Uber drivers to have a sign saying tips are appreciated (not required) and setting up an appeals process for drivers who believe they are victims of wrongful termination.

Approved Settlement? Not So Fast

While an agreement has been reached, federal district courts for both lawsuits must approve the settlements. Hearings will be held in Boston and Oakland over the fairness of the settlements. After legal fees, even with the $100 million dollar price tag for Uber, most drivers will not see more than a few hundred dollars when the dust settles.

This may leave room for another round of negotiations if the federal district court judges do not find the settlements appropriate and fair given the situation. For more information about class action lawsuits, reach out to a skilled lawyer in California.

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