Lyft agrees to pay California $272.5m in largest-ever wage theft settlement

Lyft has reached a $272.5 million settlement with the state of California to resolve allegations of wage theft. The lawsuit, which began in 2020, claimed the company misclassified drivers as independent contractors rather than employees, thereby denying them essential benefits such as overtime, health insurance, and paid sick leave. California Attorney General Rob Bonta described the agreement as a landmark victory for workers, noting that it is the largest wage theft settlement in the state's history. Approximately $237 million of the total amount will be distributed to thousands of affected drivers. While Lyft maintains that its classification practices were legal, the company stated it is pleased to resolve the matter. This settlement follows a similar $328 million agreement reached by Uber and Lyft in New York in 2023, as the long-standing debate over gig worker classification continues to evolve across the United States.