Drivers gained a lot, but still won’t have many rights guaranteed for traditional employees

Under the agreement, the drivers will earn at least $32.50 an hour and get annual raises, health insurance, paid sick time, medical leave, and occupational accident insurance. Many will be entitled to restitution pay, and there is now an official appeals process for drivers who have been deactivated.

But they won’t have access to unemployment benefits and traditional workers’ compensation insurance. If drivers have legal claims, they will still have to file individual arbitration claims with the attorney general’s office instead of filing lawsuits in court.

Drivers are also responsible for gas, car maintenance, and insurance, and aren’t paid for the estimated 25 percent of the time when they’re between passengers, meaning their actual earnings are far lower than $32.50.

“Once you do the math and consider the expenses, I doubt they would be paid much more, if anything, above minimum wage,” said Shannon Liss-Riordan, a labor lawyer who has represented numerous gig drivers and founding member of the Massachusetts Is Not for Sale coalition that advocates for driver employee status. “This allows Uber and Lyft to continue shifting the cost of running a business to their low-wage workers, and this agreement does absolutely nothing to rectify that.”

Uber and Lyft did not respond to questions about concerns with the agreement.

Some labor advocates are disappointed that drivers will still be independent contractors

Due to the control companies have over drivers’ job duties, wages, and customers, gig drivers should be classified as employees under Massachusetts state law, labor advocates say, which is why the attorney general took the companies to court in the first place. And the trial was the state’s best chance to show this.

Without a judge ruling that drivers are employees, it will be more difficult for other states to try to establish this, worker advocates note, and independent contractor business models will continue to proliferate.

“You’re creating a separate system of public regulation for two companies,” said David Weil, a labor economist at Brandeis University and former head of the wage and hour division in President Obama’s Labor Department who served as the lead expert for the state in the trial. “And that is what they’ve done all over the country. They carve out different rules that they get to live by. … Because if you could get away with this, and you could not have to make people your employees, who can resist that?”

Liss-Riordan said she is concerned about the many unanswered questions still out there.

“The attorney general was the only body who was capable of getting a ruling in court that they were breaking the law, and the attorney general has thrown away that opportunity,” she said. “There’s a lot of room in here for [Uber and Lyft] to do a lot of mischief.”

Uber and Lyft are still saving a lot of money

Because the drivers still won’t be employees, the companies aren’t required to contribute payroll taxes. According to a recent state auditor’s report, if Uber and Lyft drivers were classified as employees, their earnings would have generated estimated payments of more than $266 million into state unemployment insurance, workers’ comp, and paid family and medical leave funds between 2013 and 2023.

Campbell’s office said the $32.50 wage floor for drivers is meant to offset the lack of payroll taxes being paid into state programs for employees.

Drivers will still be responsible for their own income taxes.

Consumers are concerned about fares rising

Other cities that have raised wages for gig workers have seen mixed results.

Seattle set a minimum pay for delivery apps drivers earlier this year, but later looked to amend the measure after it pushed up prices for consumers and hurt participating restaurants.

After wages for New York City drivers went up in 2019, fares did go up, but they also increased in Chicago, where driver pay hadn’t been raised, according to a study by James A. Parrott, director of economic and fiscal policies at the Center for New York City Affairs at The New School.

“It’s hard to imagine that there would be any price effect from [the Massachusetts deal] unless the companies use it as an occasion to say that, because we’re now paying better than we used to, we’re going to raise the fares,” Parrott said.

And driver wages may not actually go up that much. Driver Charles Clemons said he already averages $25 to $35 an hour ferrying people around in his minivan. If there is a fare increase, he said, passengers will likely be willing to absorb the shock.

“They already charge the customers a little more when it rains,” Clemons said. “It’s still cheaper than a taxi cab, and the availability is there.”

Still, consumers are concerned.

Bram Shapiro of Brookline takes an Uber or Lyft to the airport or to get home after a night out because they’re more affordable than taxis. But he wonders if that will last. “It feels like an inevitability for consumers to take the hit,” he said.

Many drivers are excited

The settlement is a huge win for drivers, many of whom rely on the flexibility ride-hailing platforms provide to make money whenever they want — a luxury the companies threatened would disappear if drivers became employees.

But it seems doubtful that the companies would do away with this flexibility because it’s an intrinsic part of their business model, Weil said: “Flexibility is essential for them. … It’s not a gift to the drivers. It’s part of the profit model.”

Awet Teame, a Brookline-based driver, said she balances driving full time for Lyft with her artistic pursuits in acting and comedy. Before she joined the platform, it was difficult to accept production gigs or attend classes while reporting to a second job with strict hours. Now she makes between $1,000 and $1,500 a week on her own time.

Extending employment to Lyft workers would’ve “felt like turning them into taxi drivers,” Teame said. “Who doesn’t like being their own manager? That’s just a load off your back.”

But some drivers are concerned

In New York City, a similar wage rule led Uber to lock drivers out of its app during periods of low demand, reducing some drivers’ revenue by up to 50 percent.

Leonel De Andrade, a driver from Brockton, said the settlement is proof that the corporations “were stealing something for us.” But becoming an employee would have been even better — with more stability and protections in the long term.

“We need a guarantee that this situation — these protections — will remain for us,” he said.

Katie Johnston can be reached at katie.johnston@globe.com. Follow her @ktkjohnston. Diti Kohli can be reached at diti.kohli@globe.com. Follow her @ditikohli_.