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Postmates Settles Gig Worker Lawsuit for $1M

— August 6, 2021

Seattle’s Office of Labor Standards (OLS) announced earlier this week that Postmates will pay $1 million to settle a lawsuit with thousands of gig workers.

Gig workers working in the Seattle area are celebrating after the city’s Office of Labor Standards (OLS) announced a $1 million settlement with Postmates, a third-party delivery app. The suit was filed against Postmates over allegations that the company violated Seattle’s “Gig Worker Paid Sick and Safe Time (PSST) ordinance.” Of the settlement, $949,815.49 will go towards “back wages, interest, liquidated damages, and civil penalties” for 1,646 gig workers. Another $22,260.40 will be paid in fines to the city.

Delivery driver graphic
Delivery driver graphic; image courtesy of mohamed_hassan via Pixabay,

What is the Gig Worker Paid Sick and Safe Time (PSST) ordinance, though? In many cases, gig workers have few protections. Well, the ordinance went into effect last July after the city council voted unanimously to pass it. It effectively “allows drivers for third-party delivery apps like Postmates access to paid sick time — one day off for every 30 calendar days worked, accrued retroactively to October 2019 (or whenever each worker started employment).” On top of that, it “allows gig workers to use PSST in 24-hour increments to care for themselves or a family member for health reasons, situations related to domestic violence or sexual assault, or if a loved one’s school or place of care has been closed.” Under the ordinance, gig workers “can use up to three days of paid sick time before being required to produce a doctor’s note or other proof of care, with compensation recalculated every month to reflect earnings changes.

An investigation into the violations began last fall when the Office of Labor Standards looked into complaints from local workers over concerns that “Postmates was not adequately instituting these benefits, and allegedly violated several other aspects of the law, including failure to provide them with notice of the policy or their sick time balance,” the suit noted

It’s important to note that Uber acquired Postmates in December 2020. While commenting on the settlement announcement, Uber issued the following statement:

“While these issues arose before our purchase of Postmates was finalized, we appreciate the Office of Labor Standards’ close coordination with us to correct any outstanding issues…We’ve worked tirelessly to ensure that workers on the Postmates’ [sic] platform got the paid sick and safe time to which they were entitled, and we look forward to our continued partnership with OLS.”

OLS said that the gig workers impacted by the recent settlement should expect to receive payments within 30 days. 

This isn’t the first time that Postmates has come under fire for violating gig worker payment rules. In fact, in September 2020, Postmates and DoorDash had to pay more than $350,000 “in restitution to drivers after the city’s hazard pay mandate went into effect this summer.” While DoorDash forked over $111,435 to 2,998 Seattle gig workers, Postmates paid $250,515 to 2,975 Seattle gig workers.


Postmates Settles Lawsuit for Nearly $1 Million Over Alleged Violations of Paid Sick Leave Rule

Postmates To Pay Seattle Workers Nearly $1M in Sick Leave Settlement

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