Business

Judge Denying Uber’s $100 Million Law Suit Settlement Exemplifies Struggle With Drivers

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Eric Lieberman Deputy Editor
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Uber has been in a long fought battle with their drivers over fair treatment under federal and state law. The overarching discrepancy is whether drivers should be treated as full-time employees or independent contractors.

Uber was set to pay up to $100 million to settle a legal dispute that claims the ride-sharing company mistreats their drivers by classifying them as contractors and not affording them the same benefits full-time employees receive. But US District Judge Edward Chen will not permit the agreement because he believes the deal “is not fair, adequate, and reasonable.”

The ride-sharing service has grown so big that Uber has seemingly paid less attention to satisfying their workers’ demands and more time focusing on expanding their operations into different parts of the world. Uber has been adamantly trying to carve out a sphere in the world’s largest market: China.

Uber drivers have complained so frequently about their informal employers that there is an oft-visited forum for them to anonymously scrutinize the ride-hailing service. Drivers all across the country have engaged in public protests over what they deem unfair business practices. (RELATED: Uber Drivers Caught Smuggling Illegals Across The Border)

Uber tried to placate their drivers by adding new features, like more easily allowing for bathroom breaks and providing discounts for drivers when they want to be riders.

On April 21, 2016, the company published a statement regarding the details of the settlement and what it means for its services. Uber thought they successfully settled the cases with drivers in two class-action lawsuits. But the $100 million maximum is only a small sliver of what the total damages charged could be. Chen slammed the deal because there is “no rational basis” for rewarding “only 0.1% of the potential verdict value.”

For the most part, both parties seemed to be happy with the deal, according to Ars Technica.

But now both sides will have to reconvene and plan their next step. “The settlement, mutually agreed to by both sides, was fair and reasonable,” an Uber spokesperson said in a statement. “We’re taking a look at our options.”

Chen scheduled a status hearing for the middle of September. This case is sure to continuously showcase how the relationship Uber has with its drivers is tenuous and needs further clarification.

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