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Uber Technologies Inc. and Lyft Inc. today reached a settlement with the Massachusetts Attorney General in a lawsuit that requires the companies to pay their drivers a minimum wage.

The $175 million settlement includes a number of benefits for drivers who work more than the $32.50 per hour minimum. Drivers will also receive accident insurance, paid sick leave, paid medical leave and health insurance, while money won in the case will go to current and former drivers and state officials. Another bonus is that drivers will receive benefits if they work at least 15 hours total for both or just one of the companies.

The settlement is the result of years of legal battles between the state and the companies. There is a worldwide dispute over how people who work in the gig economy should be treated by the companies they work for. In the US, there have been similar cases in which drivers received benefits following court rulings, including in California, New York, Washington state and, most recently, Minnesota.

“For years, these companies have underpaid their drivers and denied them basic benefits,” Attorney General Andrea Campbell said in a statement. “Today’s agreement holds Uber and Lyft accountable and provides their drivers with a guaranteed minimum wage, paid sick leave, workers’ compensation insurance and health care subsidies for the first time in Massachusetts.”

Both Uber and Lyft today spoke positively about the ruling, even though both companies have collectively spent tens of millions of dollars lobbying to push back against unions fighting for better standards for people in the gig economy.

“By seizing this opportunity, we have cleaned up historical liabilities by developing a new operating model that balances flexibility and benefits,” said Tony West, Uber’s chief legal officer. “This will allow both Uber and Massachusetts to move forward in a way that meets drivers’ wishes and shows other states what can be accomplished.”

Jeremy Bird, Lyft’s executive vice president of driver experience, said he was “thrilled” that an agreement had been reached. “Rideshare is truly part of the economic and social fabric of the Commonwealth,” he said.

Photo: Barna Bartis/Unsplash