Uber and Lyft have reached a settlement in a wage theft investigation conducted by the New York attorney general's office, agreeing to pay a total of $328 million. The investigation revealed that both ride-hailing companies had systematically cheated their drivers out of pay and benefits, leading to this massive settlement.

Under the terms of the settlement, more than 100,000 current and former drivers in New York will receive settlement funds, with Uber responsible for $290 million and Lyft for $38 million. The investigation found that both companies had deducted sales taxes from drivers' commissions that should have been paid by riders between 2014 and 2017, resulting in drivers being shortchanged. Additionally, neither company had provided paid sick leave to its drivers.

As part of the settlement, drivers outside of New York City will now be entitled to a minimum hourly pay rate of $26, while NYC drivers already have minimum rates under Taxi & Limousine Commission regulations. Furthermore, all drivers will now receive one hour of sick pay for every 30 hours worked, capped at 56 hours per year.

For sick leave, NYC drivers will receive $17 per hour, while drivers outside of the city will receive $26 per hour. These rates will be adjusted annually to account for inflation. Drivers can file a claim for their share of the settlement on the New York Attorney General's website. In addition, Uber and Lyft are required to update their apps to simplify the process of requesting sick leave and provide support for any pay-related questions. Drivers will also receive detailed earnings statements explaining their compensation.

Uber separately reached another settlement with the New York Department of Labor, resolving two lawsuits related to the company's failure to provide unemployment benefits to drivers. As part of this settlement, Uber will make quarterly payments into the New York State Unemployment Insurance Trust Fund and provide retroactive payments dating back to 2013.

The settlement is seen as a victory for Uber drivers in New York, granting them access to life-saving benefits without obstacles or denials. It also signifies progress in the ongoing debate over gig worker classification, as New York takes steps to secure more protections for workers. The state has been cracking down on app-based service providers, aligning with the Biden administration's push to classify gig workers as employees.

As the gig economy faces increased scrutiny, this settlement highlights the importance of fair compensation and benefits for drivers who make these ride-hailing services possible. The settlements reached between Uber, Lyft, and New York state mark a significant step towards ensuring greater protections and rights for gig workers.

Update: The settlement also includes a statement from the New York Taxi Workers Alliance, hailing the settlement as a victory for drivers and taxpayers who will no longer have to subsidize the billionaires at Uber and Lyft.