Uber Working to Settle with California Drivers over Employee Benefits

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Uber Technologies Inc. is trying to finalize a settlement with California drivers to resolve potentially billions of dollars in claims stemming from the company’s refusal to give them the protections and benefits of employees.

The case centers on allegations that the company failed to pay minimum wage and overtime to hundreds of thousands of drivers.

Lawyers didn’t disclose terms of the deal in court filings or during a hearing Wednesday in Los Angeles state court. But they told a judge that the agreement will address penalties sought against Uber under California’s so-called bounty hunter law. The Private Attorneys General Act, or PAGA, gives employees the right to step into the shoes of the state labor secretary to bring enforcement actions.

The case is separate from a widely watched class action in San Francisco that also challenges Uber’s business model, which classifies drivers as independent contractors. The drivers in that complaint are seeking reimbursement for expenses and tips as well as PAGA penalties.

U.S. District Judge Edward Chen in San Francisco in August rejected Uber’s proposed $100 million settlement in his court in large part because he said said the deal undervalued potential PAGA claims.

Christopher Morosoff, a lawyer for the drivers in the Los Angeles case, told Superior Court Judge John Shepard Wiley Jr. Wednesday that after Chen’s ruling a decision was made that it would be best to resolve the PAGA claims separately in the Los Angeles suit. Morosoff previously said the penalties sought in his complaint could reach into the billions.

Shannon Liss-Riordan, the drivers’ lawyer in the San Francisco case, said she had no involvement in the Los Angeles settlement.

“I did not find out about it until after the fact and it may well be a subject of discussion with Judge Chen on Friday when we meet for a status conference in our case,” she said in an e-mail. She also said there’s no settlement in her case.

Liss-Riordan is pushing to get her case to trial while Uber wants Chen to pause it as the company pursues various appeals of the judge’s rulings. Uber won a critical appeals court decision that, if it stands, reduces the class size of the San Francisco case from almost 400,000 drivers to fewer than 10,000.

In the Los Angeles case, Wiley set a Jan. 6 deadline for the parties to file their proposed settlement.

Morosoff and Uber’s lawyer, Keith Jacoby, declined to comment after the hearing. Uber spokesman Matt Kallman also declined to comment.

The Los Angeles case is Price v. Uber Technologies Inc., BC554512, California Superior Court, Los Angeles County (Los Angeles). The San Francisco case is O’Connor v. Uber Technologies Inc., 13-cv-03826, U.S. District Court, Northern District of California (San Francisco).