Lyft will not have to reclassify its drivers as employees after reaching a settlement yesterday, in which it agreed to pay $12.25 million extra in compensation and benefits. Uber is facing a similar lawsuit from its drivers, but a quirk in the litigation could make the outcome way worse for the world's biggest transportation network company (TNC).
Attorney Shannon Liss-Riordan estimates that the $12.25 million Lyft agreed to pay its drivers was just one-fifth of what they could have won had the case gone to trial on a classwide basis. Does that mean Uber will have to pay its drivers $61.25 million to settle its case? Not at all. For one, Uber is a much larger company than Lyft with many more drivers, so the assumption is the penalty would be exponentially larger if Uber tries to settle. Also, Liss-Riordan has made it clear that what she is seeking is not so much financial redress, but the redefinition of how the on-demand economy operates.
TheVerge.com article here