Uber has agreed to pay as much as $100 million to settle a class-action lawsuit with drivers in California and Massachusetts. That money will be spread out among almost 400,000 drivers. Uber also admitted after the settlement that it hasn’t always done a good job working with drivers. But Uber can keep its drivers independent contractors. So, which side won?
Harry Holzer, public policy professor at Georgetown University, said it was a split decision.
“Neither side wanted to run the risk of going to trial and losing,” he said, “so they settled on something that gave the workers something.”
The drivers are getting something more than the cash, too. Uber is no longer able to cut off a driver’s right to work as it had in the past and is setting up drivers’ associations that will meet with the company quarterly.
Arun Sundararajan, a business professor at NYU, said this is just the beginning of the conversation.
“There’s a growing fraction of the workforce that is really important to the economy but do not fit into these boxes of full-time employment,” he said. “We really have to figure out a way to fund the social safety net for them.”
That social safety net includes things like minimum wage, health insurance and Social Security. Right now, Uber doesn’t have to worry about those.
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