Dive Brief:

• On-demand economy companies such as Lyft and Uber may be saving a great deal more money than expected by employing contractors, according to the savings estimate released recently in a California class-action lawsuit.

• In California alone during the past four years, drivers would have racked up $126 million in expense reimbursements had they been employees rather than contractors, Reuters reports. Lyft has called the calculation "hypothetical and misleading."

• Currently, both Lyft and its rival, Uber, face legal actions in several states from drivers who would rather be classified as employees, according to Reuters. With that would come reimbursement for expenses, such as gas costs and vehicle maintenance, which are currently paid by drivers.

Dive Insight

Reuters reveals that those staggering figures resulted from a judge's request and were calculated by attorneys for drivers based on data supplied by Lyft. As such, Reuters reports, they provide "a rare glimpse" into how much ride-hailing services may be pocketing by choosing the independent contractor designation.

Lyft, on the other hand, told Reuters via statement that a recent survey showed that 82% of drivers preferred working as independent contractors. Lyft also said the reimbursement calculation was "hypothetical and misleading" mainly because that number calculated that all drivers would be considered employees, no matter how many hours they worked.

In this specific case, the estimates are part of the judge's efforts in deciding a proposed settlement of a class-action lawsuit filed by California drivers against Lyft. For the new breed of employers working within the on-demand economy, the contractor vs. full-time employee battle may last quite awhile.