Taxi-hailing firm Uber has agreed to pay up to $100m (£70m) to settle a US legal action over whether drivers should be classified as employees or independent contractors.
Drivers had argued that they should be classed as employees, entitling them to claim expenses and other rights.
The decision to settle will come as a relief to Uber and others in the on-demand economy who use contractors.
But critics will be disappointed the case is not going to trial.
In a blog post, Uber boss Travis Kalanick said he was pleased with the settlement, which means drivers will continue to be independent contractors.
“Drivers value their independence – the freedom to push a button rather than punch a clock, to use Uber and Lyft simultaneously, to drive most of the week or for just a few hours,” he said.
But he acknowledged: “We haven’t always done a good job working with drivers.
“It’s time to change.”