BOSTON (NEWSnet/AP) — Drivers for Uber and Lyft will earn a minimum pay standard of $32.50 per hour, under a settlement announced Thursday by Massachusetts Attorney General Andrea Campbell.

The two companies also are required to pay a combined $175 million to the state to resolve allegations that the companies violated wage laws. A majority of it will be distributed to current and former drivers.

Campbell said the settlement resolves litigation against the companies and stops the threat of an attempt to rewrite state employment law by a proposed ballot initiative. That question would have resulted in drivers receiving inadequate protection and an earnings standard that would not guarantee minimum wage, she said.

“For years, these companies have underpaid their drivers and denied them basic benefits,” Campbell said.

Drivers will earn one hour of sick day pay for every 30 hours worked, up to 40 hours per year. Drivers will receive a stipend to participate in the state’s family and medical leave program.

The plan also allows drivers to pool hours; and receive paid sick leave, occupational accident insurance and health care stipends.

Uber said the agreement is “an example of what independent, flexible work with dignity should look like in the 21st century.”

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