Uber and Lyft must pay Massachusetts taxi drivers $32 per hour

Rideshare drivers in Massachusetts will soon receive the company’s benefits, plus a $32.50 hourly minimum wage, starting August 15. That’s thanks to a New settlement Between the state and ride-hailing companies Uber and Lyft, four years after Attorney General Andrea Campbell filed a lawsuit against the companies, asserting that their drivers should be considered employees under state law.

The two companies also agreed to pay a total of $175 million, the bulk of which will be paid to “current and former drivers who were underpaid by the companies.” Campbell’s office announced yesterday. The office says it will publish details about who is eligible and how to apply “in the coming weeks.” Despite the settlement and the original substance of the lawsuit, the drivers will still be considered independent contractors.

However, drivers in the state will receive annual pay increases based on inflation and other employee-style benefits, such as the ability to earn up to 40 hours of sick leave per year, paid at $20 per hour. Uber and Lyft will also give stipends to drivers so they can afford health care and sign up for the state’s Family and Medical Leave program, and will cover work-related injuries.

To ensure compliance with the agreement, companies must conduct annual audits and submit reports to the Attorney General’s Office. Penalties for violations may include “any applicable damages, fines and penalties.” According to the published settlement.