Lyft to Pay $272.5 Million in Taxi Employment Infringement Claim

U.S. taxi service Lyft has agreed to pay $272.5 million in a lawsuit over the violation of labor rights of drivers in California. About $237 million will go to a special fund to pay compensation to drivers who were allegedly paid below the minimum wage between 2016 and 2020, Fox Business reported.

In 2020, California Attorney General Rob Bonta and prosecutors in Los Angeles, San Diego and San Francisco filed a lawsuit against Lyft. They accused the company of misrepresenting drivers as independent contractors rather than employees.

According to the plaintiffs, because of this classification, drivers received less than the minimum wage and were deprived of other guarantees provided by state law. The amount of compensation for each driver will depend on the number of hours worked and total mileage between April 2016 and December 2020.

California Attorney General Bonta called the agreement the largest settlement in the state's history for misclassifying workers.