Uber Eats has agreed to pay $15 million to more than 16,000 delivery drivers in Seattle after reaching a settlement with the city’s labor standards office over allegations that the tech giant violated laws regulating worker pay.
A majority of the settlement was related to the city’s Independent Contractor Protections (ICP) Ordinance, which passed in 2021 and aims to ensure pay transparency. The City alleged that Uber Eats misled drivers by not disclosing that its “Boost” multiplier feature only applied to a portion of a fare and that the upfront payment amount already included the “Boost” promotion’s contribution.
Uber ended the “Boost” offer in August 2023, after the City contacted the company, according to the Office of Labor Standards (OLS).
Regulators also investigated Uber Eats for allegedly failing to provide minimum pay for certain canceled orders, per the city’s App-Based Worker Minimum Payment (ABWMP) Ordinance, which passed in 2022.
The City also alleged that Uber Eats failed to provide required notice of rights, electronic receipts, and weekly statements as required by the laws.
“As the largest settlement in OLS history, this sets a new benchmark and represents a significant milestone for the protection of worker rights in Seattle in the rapidly growing industry of app-based work,” Steven Marchese, director of the Office of Labor Standards, said in a statement.
Uber denied wrongdoing but agreed to the settlement. It also paid more than $33,000 in fines to the City of Seattle and will adopt a new policy that lets workers provide more information about cancellations.
“We value the work couriers do and want them to be successful,” the company said in a statement to GeekWire. “We’ve worked with the City of Seattle to resolve claims about information provided to couriers on offers and pay — and we’re focused on improving the experience for Seattle’s couriers, consumers and restaurants.”
Payment to workers is scheduled to be distributed by Labor Day next week.
“This historic $15 million settlement is a major win for workers and a strong reminder that in Seattle, we hold large companies accountable when they sidestep their responsibilities and shortchange workers,” Mayor Bruce Harrell said in a statement.
Seattle has been a leader in establishing worker protections for gig workers who make deliveries and drive people around town.
Uber previously paid $3.4 million in a settlement with Seattle in 2021. The City also reached a $1.6 million settlement with DoorDash in 2023.
Regulatory costs are part of why Uber fares in Seattle are the highest in the country, the Seattle Times reported.
DoorDash recently increased delivery fees in Seattle in response to what it called “extreme regulations” passed by Seattle lawmakers, including a new law that gives app-based workers more transparency when they’re removed from platforms.
