Misclassification Claims Cost Lyft $272.5M in Record California Settlement
On Oct. 1, 2026, California’s Labor Commissioner’s Office (LCO), along with state and local enforcement partners, announced a $272.5 million settlement with Lyft. It resolves a misclassification dispute alleging that Lyft treated California drivers as independent contractors.
The agreement is the largest wage-and-hour settlement in state history, according to the press release.
LCO: Misclassification Errors Lead to Multiple Wage Violations
The LCO alleged that Lyft denied drivers minimum wages, overtime, rest break premiums, expense reimbursements, accurate wage statements, timely wage payments, paid sick leave and other protections.
Under the settlement, 87% of the total will go directly to drivers. The settlement covers alleged violations from April 6, 2016, through December 15, 2020. It doesn’t require Lyft to reclassify drivers or cover later work. Proposition 22, approved in 2020, set separate classification rules for app-based drivers who meet certain criteria.
More info: DIR News
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