Lyft proposes to pay drivers $27 million in revised settlement

Lyft Inc. and its drivers in California proposed a $27 million settlement of their lawsuit over pay and work expenses Wednesday, more than twice the amount that a federal judge rejected as inadequate last month.

The settlement, which requires court approval, would compensate drivers for some of their costs in fueling and maintaining their vehicles.

Lyft’s general counsel, Kristin Sverchek, said the terms of the agreement would help to “preserve (drivers’) flexibility to control when, where and for how long they drive on the platform.”

The announcement comes five weeks after Lyft’s larger rival, Uber Technologies, negotiated a similar settlement with its drivers that would pay them $100 million, also subject to court approval.

Both Lyft and Uber contend their drivers are independent contractors, noting that they determine their own work hours, provide their own cars and decide which passengers to accept.

[...] the drivers, with support from California’s labor commissioner, have cited both companies’ extensive control over their working conditions, including fares, routes and reimbursement.

Under California law, the state would get 75 percent of any penalties awarded by a jury if the case went to trial.