There have been a lot of lawsuits against Uber and Lyft but recently, senior RSG contributor Jay Cradeur decided to investigate the arbitration process, and it turns out there could be a huge potential payout for him and many other California drivers down the road. Since this is a service that could be so valuable to drivers, we have decided to partner with the law firm representing Jay – Potter Handy, LLP. But, as always, all opinions in the article are our own.
Uber and Lyft have been great for me. I have been driving for four years and have managed to make a decent living that has afforded me the opportunity to travel when I want, write articles and make videos when I want, and work hard on my Plan B.
However, I also realize that if I worked this hard for any other company, I would have earned substantially more. It turns out that under California law, I should have been paid over $600,000 more in those four years.
This article will share how California drivers like you and me can take legal action to transfer some of that money out of Uber and Lyft’s coffers and into our hands.
Who Is Potter Handy, LLP?
Potter Handy, LLP is an experienced San Diego law firm that represents gig economy rideshare drivers in California who want to pursue legal action against Uber and Lyft. Due to the recent passage of Assembly Bill 5 (AB5), rideshare drivers in California have the legal rights of employees and therefore should enjoy all the safeties and benefits afforded employees. Potter Handy means business, as we can read from their website:
Potter Handy, LLP is a leading law firm due to its extraordinary record of precedent-setting cases. While Potter Handy’s advocacy has resulted in hundreds of published opinions, there are a score of such cases that wield tremendous influence… Potter Handy takes cases to judgment on average more than once a month. Opposing attorneys should know that if they do not offer a fair settlement to a client of Potter Handy, they are dealing with a law firm that won’t hesitate to seek full recovery for its client in trial and that it will effectively defend any appeal filed by the defendant. Potter Handy challenges any firm to compare its litigation history with Potter Handy’s.
There is a four-year statute of limitations in California for business issues such as this one. Therefore, drivers who did any driving between January 2016 through December 2019 are ideal clients for Potter Handy. The more that you drove, the more potential you have to earn a larger payout.
Potter Handy is only representing drivers in California. Law firms may only practice law in the states in which they are licensed to practice law, and Potter Handy is a California law firm. Also, California has laws and statutes that support this type of claim. If you are in another state, you should contact an employment attorney to consult on your particular case as Uber and Lyft are facing numerous similar legal challenges in states across the country.
What Are Drivers Entitled To?
When I first met with Jim, my attorney at Potter Handy, I asked this very question: What can I get out of this? There are several components to what I will call our “back pay.” They are:
- Overtime Premium Pay (Anything over 40 hours in a week, or over 8 hours in a day)
- Non-Productive Time Wages (Period 1 and 2, getting gas, finding a Starbucks bathroom)
- Mileage Expense (Huge!)
- Meal Period and Rest Period Reimbursement
- Unreimbursed Business Expenses (All the things we buy for our business)
That can add up quickly, especially if you have been a full-time driver like I have been. The Potter Handy website has a damages calculator that you can use to get an estimate.
This is the damage calculator I used to determine I am owed over $600,000 in back pay from Uber and Lyft. Your results may be similar, less or possibly even more, depending on when and where you drove. I’ve done over 26,000 Uber and Lyft trips though so I’m probably at the high end of a potential payout.
I suggest anyone who did any driving in the past four years for either Uber or Lyft to check out the damages calculator and confirm your situation.
What You Need To Know
Once you have used the damage calculator, then you will have an idea about the potential for your case. When I went through the damage calculator, my result was over $600K and you can see that here:
I don’t expect $600K. What I did was cut that amount in half (being very conservative), and then multiply by 60% to account for the highest possible legal fees. When I did this, I came up with what I feel is a more realistic estimate:
- $600,000 x 50% = $300,000 (Adjusting for negotiation)
- $300,000 x 60% = $180,000 (Adjusting for 40% legal fee)
Now that I have estimated my figures down, I am left with the question: is this legal matter worth pursuing? Of course it is! With an extra $180K, I could pay a top investor $6K per year to manage my money and live off the interest in Thailand and live like a king. Let’s do this!
How To Get Started with Potter Handy, LLP
Potter Handy has made it very simple to get started and get your case underway. First, go through the damage calculator. This will get your information to Potter Handy.
Second, an attorney will call you to review your case.
Third, you will receive a DocuSign attorney retainer agreement. This is where you agree to no upfront costs on your part, and Potter Handy will earn either 33% or 40% of the settlement amount depending on whether you go to arbitration or not.
Fourth, you will provide Potter Handy with documents to support your case, such as your Uber and Lyft end of year summaries (available on the Uber and Lyft website) showing how many hours you logged online.
Fifth, Potter Handy takes legal action on your behalf, and you wait until Uber and or Lyft respond.
Sixth, you agree to a final settlement amount and get paid, less your legal fees.
Final Considerations: Should You Sue Uber and Lyft?
I had three major considerations before moving forward with legal action against Uber and Lyft.
First, would Uber or Lyft retaliate against me and deactivate me? Since I’m only driving part-time these days for Lyft, this isn’t a huge deal to me. I was also reminded by my attorney that it’s actually illegal for Uber or Lyft to deactivate drivers who engage in arbitration against them and it would only make my case stronger.
However, if you can’t live without driving for Uber or Lyft, then this is a serious consideration. I have other ways to earn revenue, so if either company did illegally deactivate me, this would actually be good news as it would bolster my case, and I would have other ways to earn money and pay bills just in case. I think it would be pretty stupid of Uber and Lyft to deactivate a driver over arbitration but we all know how arbitary their deactivation prcoess can be.
My second consideration is timing. I was told this process could take over a year. This is not a quick turnaround. Since I consider this to be free money (money I was never expecting), I am fine with the timing. But if you’re at all familiar with the legal system, you know that cases like this can take years. And it looks like some of the gig economy companies are doing what they can to delay arbitration so that may mean it takes more than a year.
My third consideration is the reality of the situation. Right now, I am thinking I could possibly get a $180K payout next year about this same time. Since this is all new, I will be one of the first to go through this process. Will it happen? My honest answer is that I don’t know. I do know that I will proceed because I believe the odds are in my favor. It makes sense to me and since the lawyers only get paid if we win, I feel that their incentives are aligned with my mine. Why would they take this case if the payout was only going to be a few thousand dollars? They wouldn’t.
If you have spent any time driving for Uber and Lyft in California over the past four years, you should check out the damage calculator. Take a look and see what may be possible.
If you are like me, the payout number is significant. I am going to go for it. Just last week, I took an Uber and the driver had 32,000 trips. After talking with me, I have no doubt he is going to do it, too.
It is big money, and Uber and Lyft have the money. They have been treating us like employees. Why shouldn’t we get paid like employees? Potter Handy LLP is on to something here. They are good people and I believe they will represent me well in 2020. Be safe out there!
Who’s eligible to sue Uber/Lyft?
Any rideshare driver who drove for Uber or Lyft in California during the past four years.
How much can a driver win in a legal case?
The best way to get an idea of your potential winnings, is to use the damage calculator. This will give you an idea of the total which you can then adjust for legal fees.
Is there anything else I should know?
If you are considering taking action, use the Damage Calculator and then a Potter Handy attorney will contact you. At that point, you can ask any further questions.
Drivers, would you sue Uber and Lyft for back pay? Why or why not?
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-Jay @ RSG