UPDATED 22:52 EDT / MAY 23 2017

APPS

Uber will pay up to $45 million to reverse its underpayment of New York drivers

Uber Technologies Inc. drivers in New York City will be getting their holiday bonuses early this year in the sum of about $900 each, a consequence of the ride-hailing giant underpaying them for two and a half years.

Reports revealed today that Uber had been shortchanging drivers in New York after taking more commission than it should have, basing its cut on the gross cost of a ride rather than the amount the driver received after sales tax and fees for injured drivers. Uber said it only recently discovered the mistake when it was developing a new pricing scheme.

However, in June 2016 Bloomberg BNA ran an article on New York City Uber drivers saying the company was stealing from them. The alleged theft, and subsequent lawsuit, was exactly what Uber is apologizing for now.

“Uber commits wage ‘theft’ and breaches its own driver contract by making unlawful deductions from driver fares for the cost of sales tax and a surcharge for a disability fund for injured drivers of limousines in so-called black car fleets in New York,” said the article.

Uber has already righted this wrong, and has stated that tens of thousands of its drivers will be eligible for a refund. The total payout is estimated to be as much as $45 million.

We are committed to paying every driver every penny they are owed – plus interest – as quickly as possible,” Rachel Holt, Uber’s regional general manager for U.S. and Canada, said in a statement. “We are working hard to regain driver trust, and that means being transparent, sticking to our word and making the Uber experience better from end to end.”

The news follows a similar issue in March, when Uber admitted it had been overcharging its UberBlack drivers in Philadelphia, resulting in apologies from Uber and refunds of $4.3 million. In January Uber was forced to pay $20 million in settlements after being found guilty of misleading drivers regarding what they’d probably earn on an average day.

Image: Jason Newport via Flickr

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