Uber and Lyft must pay Massachusetts rideshare drivers $32 an hour

Massachusetts rideshare drivers will soon get company-provided benefits, as well as a $32.50 per hour minimum wage, starting August 15. That’s thanks to a new settlement between the state and rideshare companies Uber and Lyft, four years after Attorney General Andrea Campbell sued the companies, saying their drivers should be considered employees under state law.

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

Still, drivers in the state will receive annual wages based on inflation and other benefits, such as the ability to earn up to 40 hours of sick leave per year, paid at $20 an hour. Uber and Lyft will also provide stipends for drivers to purchase health care and enroll in the state’s family and medical leave program, and cover workplace injuries.

To ensure compliance with the agreement, companies must conduct annual audits and submit reports to the attorney general’s office. Penalties for violations could include “any applicable restitution, fines and penalties,” according to the published regulations.

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