Lyft settles landmark driver misclassification lawsuit for $272.5M

Lyft has reached a $272.5 million settlement with the California Attorney General and three city attorneys to resolve a major lawsuit regarding driver misclassification. The legal action, which began in May 2020, alleged that the ride-hailing company committed wage theft by classifying its drivers as independent contractors rather than employees between 2016 and 2020. The lawsuit, originally filed by then-Attorney General Xavier Becerra, argued that Lyft failed to comply with state labor laws, depriving workers of benefits and protections afforded to employees. While this settlement concludes the case against Lyft, the ongoing litigation against Uber regarding similar allegations remains active. This agreement marks a significant development in the long-standing debate over the employment status of gig economy workers in California, as regulators continue to push for greater protections for those operating within the ride-hailing sector.