Uber Technologies and Lyft reached a settlement with Massachusetts wherein the ride-sharing firms will pay a combined $175 million to resolve allegations they violated Massachusetts’ wage and hour laws, the attorney general’s office announced June 27. Uber and Lyft also agreed to pay drivers a standard hourly rate of $32.50 and provide a suite of benefits.

The settlement is a win for Uber and Lyft, as the firms had sought for years to reach deals that would provide drivers with new benefits while continuing to classify them as independent contractors, according to Bloomberg. As a result of the settlement, Uber and Lyft also plan to withdraw their support for a Massachusetts ballot initiative that would have asked voters to rule that drivers should remain independent contractors.

“This agreement is an example of what independent, flexible work with dignity should look like in the 21st century,” Uber Chief Legal Officer Tony West wrote in a blog post. “We are thrilled to see more policymakers supporting portable benefits and innovative frameworks to improve independent work.”

Lyft also commented.

“We’re thrilled to reach an agreement that works for everyone and builds on similar progress we’ve made in states like New York, California, Minnesota and Washington,” Jeremy Bird, Lyft executive VP of driver experience, wrote in Lyft’s post.

Uber will pay $148 million of the settlement and Lyft will pay $27 million, according to the attorney general’s office. Most of the funds will go to drivers.

“Today’s agreement holds Uber and Lyft accountable and provides their drivers — for the very first time in Massachusetts — guaranteed minimum pay, paid sick leave, occupational accident insurance and health care stipends,” Massachusetts Attorney General Andrea Joy Campbell said in a press release.

Among the provisions of the settlement, independent contractor drivers will:

• Earn minimum pay of $32.50 per hour for time spent on the way to a pickup and during a ride. This starts Aug. 15. Uber noted it’s the same standard adopted in California, New York and Minnesota.
• Earn one hour of sick pay for every 30 hours worked up to a maximum of 40 per year.
• Get access to a health insurance stipend if they drive more than 15 hours per week.
• Be eligible for occupational accident insurance paid by the companies for up to $1 million in coverage for work-related injuries.
• Be eligible for paid family medical leave insurance.
• Be able to appeal deactivation of their accounts.
• Be able to receive chat support in English, Spanish, French and Portuguese.

Bloomberg contributed to this story.