GoKawiilLyft to pay $272.5M settling California driver misclassification lawsuit
Lyft has agreed to pay $272.5 million to resolve a lawsuit filed in 2020 by the California Labor Commissioner's Office, which accused the company of wrongly classifying drivers as independent contractors rather than employees. The case alleged drivers were denied minimum wage, overtime, sick leave and timely wage payments between April 2016 and December 2020. The settlement still requires court approval, and the Labor Commissioner's Office says it will forgo its share so funds go directly to drivers who filed wage claims.
GoKawiil's interpretation of the reporting above, not reported fact.
The payout closes a years-long legal fight dating to before Proposition 22 reclassified app-based drivers as contractors, so it applies only to a now-superseded period of California gig-work law. Lyft's regulatory filing suggests the company wanted to end 'protracted litigation' rather than risk a larger judgment or ongoing distraction, though it did not admit wrongdoing. The outcome could encourage other gig workers or regulators to pursue similar historical misclassification claims even though current law treats drivers as contractors.
- Lyft will pay $272.5 million to settle a driver misclassification lawsuit from California regulators.
- The case covered the period from April 2016 to December 2020, before Prop 22 took effect.
- The California Labor Commissioner's Office says it will redirect its share of the settlement to affected drivers.
Source: techcrunch.com — Kirsten Korosec, 2026-10-01
Published there as: “Lyft is paying $272.5M to settle lawsuit over how it classified drivers”
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