Uber faces $100 million bill to end drivers’ dispute

Uber has agreed to pay up to $100 million (£70 million) to settle a pair of US lawsuits that mean the minicab app gets to keep drivers as contractors rather than employees.

In a case that has gripped Silicon Valley and sparked protests against the controversial tech firm, a lawsuit had claimed drivers are employees and should be entitled to reimbursement of expenses.

The agreement will spare Uber from a jury trial in San Francisco that was set for June.

As part of the settlement, which must be approved by a judge, Uber will stump up $84 million to be distributed to 385,000 drivers in California and Massachusetts. A further $16 million could be paid, subject to conditions.

The firm will also work to create a drivers’ association in both states and revise practices such as deactivating drivers from the app without much warning.

In a blog post titled “growing and growing up”, Uber chief executive Travis Kalanick said: “We haven’t always done a good job working with drivers.”