Uber to pay $3M to settle driver service fees class action in NY

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Uber has agreed to pay $3M to settle a proposed class action lawsuit brought by 2,421 drivers in New York who had accused the ride-sharing giant of docking excessive fees from their fares.

The preliminary settlement was filed with on Monday with the federal court in Brooklyn, according to Reuters.

The original suit was filed in the court in January 2016, and covers Uber drivers who have used the Uber app to arrange rides in New York since December 29, 2009.

The drivers had accused Uber of breach of contract by including NY state sales tax and a state workers compensation fund surcharge, called the “Black Car Fund” fee, when it calculated their service fees — thereby increasing how much they were being charged.

The drivers also accused Uber of false advertising by offering guaranteed compensation without disclosing the conditions.

According to Reuters, Uber denied all allegations, and settled without admitting wrongdoing to avoid the cost and inconvenience of litigation.

At the time of writing the company had not responded to a request for comment on the settlement.

This is just the latest outlay for Uber insofar as driver-related complaints are concerned. In January 2017 Uber agreed to pay $20M to settle an FTC complaint that it mislead drivers about earning potential and vehicle financing.

While, last May, it agreed to pay more than $80M to ~96,000 drivers in New York, after it admitted having inadvertently underpaid them for two-and-a-half years.

Over in the UK, Uber also recently lost an appeal against an employment tribunal ruling that found a group of drovers to be workers not self-employed contractors — raising the prospect of it having to shell out tens of millions of pounds in its most lucrative European market if it ends up having to fund workers rights benefits for all its UK drivers.

On the job classification front, Uber struck a $100M class action settlement with 385,000 US drivers in April 2016 — getting them to agree to remain classed as independent contractors in exchange for providing them with some concessions, such as not penalizing drivers who decline trips when logged into the app, as well as handing over a chunk of cash.

In June 2016 Uber also paid $7.5M to settle a lawsuit brought by drivers over background checks. That suit had alleged that Uber terminated drivers from its platform after obtaining their consumer background reports without authorization.

Featured Image: Spencer Platt/Getty Images