U.S. judge questions Lyft settlement over driver benefits

http://www.reuters.com/article/us-lyft-drivers-hearing-idUSKCN0WQ2GZ


A U.S. judge questioned on Thursday whether a proposed class action settlement between Lyft and its California drivers is fair and raised concerns that the $12.25 million payment offered by the ride-hailing service might be too low.


The 2013 lawsuit brought against Lyft by California drivers contended they should be classified as employees and therefore entitled to reimbursement for expenses, including gas and vehicle maintenance. The drivers, who are currently independent contractors instead of employees, pay those costs themselves.


At a hearing on Thursday, U.S. District Judge Vince Chhabria in San Francisco said he was concerned that the proposed settlement does not reflect the company's explosive growth in California over the past few months.


Employment status is critical for the so-called on-demand technology companies. The case involving Lyft and another class action lawsuit against larger rival Uber have been closely followed because a determination that workers are employees rather than contractors could affect valuations of other startups.