Lyft to Pay $272.5 Million in Record California Wage Theft Settlement

Lyft (NASDAQ: LYFT) agreed to pay $272.5 million to settle a California wage-and-hour lawsuit, the largest such settlement in state history. The deal resolves allegations that the San Francisco-based ride-hailing company misclassified drivers as independent contractors between 2016 and 2020, denying them minimum wage, overtime, rest-break premiums, expense reimbursements, and sick leave. Eighty-seven percent of the total will go directly to drivers. The California Labor Commissioner's Office filed the suit in 2020 in Alameda County Superior Court. The case was later coordinated with actions by the California Attorney General and the city attorneys of Los Angeles, San Diego, and San Francisco in San Francisco Superior Court in September 2021. "Lyft believes drivers have always been properly classified under the law, and we're glad to put this case behind us," the company said in a statement. The settlement follows California voters' 2020 passage of Proposition 22, which permits gig drivers to be classified as contractors, and the September certification of the California Gig Workers Union under Assembly Bill 1340.