Lyft will pay $272.5 million over how it classed drivers. Uber faces similar claims.
Lyft is paying $272.5 million to settle a California lawsuit over how it classified its drivers, TechCrunch reported on Thursday.
The state's Labor Commissioner filed the case in August 2020. The Attorney General and three city attorneys are also plaintiffs.
The claims cover April 2016 to December 2020. They allege drivers were treated as contractors rather than employees and went without minimum wage, overtime, paid sick leave and timely pay. The settlement still needs approval.
"If approved, this settlement closes a chapter from a very different time, before Prop 22," a Lyft spokesperson said. Prop 22, passed by California voters in 2020, lets rideshare drivers stay contractors with set benefits.
The report does not say how many drivers are covered or what each would receive. The timeline is the number a finance team can use: about six years from filing to settlement. Uber still faces a separate Labor Commissioner case with similar allegations.
How early would your company have booked a reserve for a claim like this?
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For your next steering committee
- 1Ask which exit clauses your largest software and services contracts carry, and when each can be used.
- 2Ask what leaving would cost, in money and in months.
- 3Ask who reads the contract when a dispute starts, and whether they have read it before.
Issue 01 of the ERP LEADERS brief puts a timeline, the three-number review and six questions on one page. Read issue 01
Welcome back. · Issue 01
