Lyft Sued for Unfair Competition and Labor Violations (Update)

Update, 12:45 p.m.: Lyft's response: "The lawsuit is without merit and we look forward to resolving it quickly and effectively."

lyftshot.png
The rideshare battles that took place outside City Hall a few weeks ago have now moved, unequivocally, into San Francisco district court.

We saw inklings of that when two drivers filed a class action complaint against Uber two weeks ago, alleging that the company had skimmed their tips and misled its clientele. And now its competitor Lyft faces a similarly themed class action, in which plaintiff Patrick Cotter alleges that the company misclassifies its drivers as independent contractors.

That driver-for-hire categorization is a lingua franca for rideshare services, because it helps distinguish them as startups that produce technology, rather than conventional cab fleets with an employed labor force. Lyft, Uber, SideCar, and their other sharing-economy brethren have argued, time and again, that their only products are apps, and that their only function is to refer drivers to passengers. The drivers provide their own cars, their own gas, and even their own insurance policies -- albeit with a promise of million-dollar per-incident excess liability from each company.

Now it's for courts to decide whether that business model truly serves the public interest.

The latest lawsuit, filed Tuesday, argues that drivers like Cotter are in fact employees of Lyft, which means they warrant protection from the California Labor Code. Thus, Lyft should be prohibited from skimming 20 percent from drivers' gratuities, and it should provide wage statements that accurately reflect the number of hours that each driver worked. It should also reimburse drivers for mileage, Cotter argues, echoing charges from the Uber case.

The suit demands $4.5 million in class-wide damages, based on calculations that most drivers average $15 per tip, and Lyft filches 20 percent of that. The plaintiffs and their San Francisco-based lawyer, Matthew Carlson, also have Lyft on the hook for an estimated $2 million in derelict wage statements, and another $4.5 million in mileage costs for the 1.5 million Lyft rides granted so far. Cotter also wants the rideshare service to pay his attorney fees.

We are still waiting for comment from Lyft. Carlson says he's content to allow the allegations to stand for themselves, but he's anxious to hear Lyft's response. But in the meantime, here's the complaint:

LyftSuit

My Voice Nation Help
31 comments
momwithtwoheads
momwithtwoheads

@Roberto Corso Campos You said that Lyft riders are stupid. Really??

I am not stupid if I want to sit in the front seat, have a nice conversation, have the option of paying less or not paying at all if I'm not happy (that's never happened, but still), share my music, charge my iphone, ride in a nice clean car that doesn't smell, have a nice driver who doesn't scream into his bluetooth cell phone the whole ride or refuses to drive my route, or start being sexist or racist, or having a lousy app that doesn't work or let you track the actual car as it arrives. Yes, lyft is the OPPOSITE of a normal cab ride in SF 99% of the time. Cabs are awful especially for women, and with Lyft, the rides just never are anything less than a fun time. 


So no, I'm not stupid.

And actually, the Lyft people are insured, they are regulated, and they contribute to the community with charity events, and huge driver community, and the general good vibes of having fun rides. Cab companies just make some absentee owner rich because he bribed someone for a license.

As for whether lyft drivers are contractors or whatever, let the judge decide.

howierulez
howierulez

Well, honestly the system that Lyft uses now for drivers is unfair and just plain wrong.  As a driver you drop below a 4.7 and you get the email (hack the Lyft Drivers Lounge page) and you will understand what i am saying.  I surely beat up my car driving fro Lyft and feel as though they "used" me, as I had (1) a Lyft Investor (2) P3 Power Lyfters as passengers and the big one, a drunk, stoned guy in Russian Hill who clearly told me he was Paid a sum to get 5 Lyft's on a Sat night and take notes.  I had a 4.6 and that was my first warning.  By the time I got a callback from Performance@lyft.com to explain to me "what" I did incorrectly and "how" to improve he advised me that in the time period from my first email to this oen I had , and these are his words, JAY !  "You have drastically improved...."  I did Outside Lands bringing in close to $900 for 32 hrs and then a week later boom.  Boom means I know i had some shitty passengers but I did my job, shut up , offered the water and took them where they were going.  Next day, split shift, take a 10 minute break and try to go into driver mode and Nada.  Check email, nanda.  Call support and after a 5 minute hold am told I a no longer authorized to drive.  i inquire furthur of course and am given no real information.That's all.  And it is wrong and I really am looking in to my options here.  All I can say is that if you are a driver, do NOT, for a second believe Lyft.

mmmanahan
mmmanahan

I've driven for lyft and they treat all their drivers exceptionally well. This is kinda bullshit.

non_mechanical
non_mechanical

I just have to point out that every single time I get a cab, I am reminded how much more superior Lyft is- for providing a much better service in so many ways. 

I can't remember the last time I road in a cab and it was a pleasant experience. The most common issue I have is bad driving. Herky-jerky cornering, abrupt acceleration, and  abrupt braking- have left me walking away sick and disoriented. Cab services need to raise their standards.There are so many bad driving cabbies on the road. (There is also a disproportionate amount of bad drivers on the road in the Bay Area to begin with, but thats another issue) I know so many people, along with myself, that have dozens of anecdotal stories about cabbies endangering themselves, their passengers and other drivers on the road.

I have only used Lyft for about a month, but I plan to use it and anything like it as long as it exists. Lyft is providing a service that cab companies are flat out not providing i.e.: more availability, a smooth and safe ride, and Lyft drivers have just been generally more pleasant and civil. I can't tell you how many times I've gotten unprovoked attitude from cabbies in this city. 

Until cab companies figure out away to improve the produce they are providing, I'll stick with Lyft and the like...

DaveBobSutton
DaveBobSutton

It’s easy to imagine Lyft vulnerable in a court of law based on the past goofiness it has asked people to swallow. For example, everyone knows Lyft is not a “ridesharing” company—it’s a taxi company, not a carpool among friends. Just like everyone knows payment is not “voluntary.” (Not if you want to keep riding). And If Lyft was really a tech company, it wouldn’t be hiring drivers on Craigslist.

It’s like the business model started out as an inside joke, but these sort of wink-wink arrangements don’t typically go over well in court.

Alejandro Durazo
Alejandro Durazo

Pirate cabs? LMAO...next time, I'll make sure to wear an eye patch.

Quest Henkart
Quest Henkart

@Réne Rivers Lyft drivers are not assigned hours or shifts, the app connects a driver with a passenger, if you really want to dissect the process within the parameters you provided, a lyft driver is agreeing to a specific project (the ride from point a to point b) for the time that it takes to get from point a to point b. A lyft driver is no more an employee of Lyft, than an ebay seller is an employee of ebay,

Roberto Corso Campos
Roberto Corso Campos

All riders that uses Lyft are stupid. Why would you pay the same rate to ride uninsured??? You can order a cab ride through an app too, nothing new! Plus, they don't pay taxes and don't contribute to the community. Their cars don't have to go through any inspections. They have no regulations!!! They are just pirate cabs!

srslycmon
srslycmon

"Now it's for courts to decide whether that business model truly serves the public interest."

That's a frightening sentence. I wonder if it'd ever be applied to the taxi industry? 

Megan Rowe
Megan Rowe

Ain't no thang, Marísa! I got my bike. Thanks for thinking of me though!

Réne Rivers
Réne Rivers

Sorry but unless you are hired by a company for a specific project that has a specific time period, you aren't an independent contractor. Nor are you a independent contractor if you are doing something for a company that is part of regular everyday business.

Eric Gonzalez
Eric Gonzalez

The fact that a successful company is being sued is not big news. They've got $$, now someone wants it.

Eric Carlson
Eric Carlson

the whole mess really makes us wonder why the government is involved in limiting competition

Alejandro Durazo
Alejandro Durazo

I'm a Lyft driver and have NO complaints. So, one guy doesn't speak for the rest of us.

Thomas Mulhern
Thomas Mulhern

$15 per tip? What a load of BS not even taxi drivers make $15 per tip. I bet the guy suing, was hired on the fly by the some SF Taxi company just to do this.

Lauren Larsson
Lauren Larsson

Rob, more like lobbying and politics at its best. The market is saving us here. The government has been in the taxi unions' pocket.

Jai Singh
Jai Singh

I'm more of a Sidecar guy myself #fistbump

Taj Harris
Taj Harris

The company was sued by one of it's own drivers...

Rob Blomberg
Rob Blomberg

Looks like those pink mustaches were becoming too much of a threat to the taxi industry in SF... I wonder how many pockets the taxi lobby lined to limit our options here in the city. Corporatocracy at its best. Smh.

momwithtwoheads
momwithtwoheads

@Roberto Corso Campos I am not stupid if I want to sit in the front seat, have a nice conversation, have the option of paying less or not paying at all if I'm not happy (that's never happened, but still), ride in a nice clean car that doesn't smell, have a nice driver who doesn't scream into his bluetooth cell phone the whole ride or refuses to drive my route, or start being sexist or racist, or having a lousy app that doesn't work or let you track the actual car as it arrives. Yes, that's a cab ride in SF 80% of the time, it's awful especially for women, and with Lyft, the rides just never are anything less than a fun time.

So no, I'm not stupid.

And actually, they are insured, they are regulated, and they contribute to the community with charity events, and huge driver community, and the general good vibes of having fun rides.

As for whether their drivers are contractors or whatever, let the judge decide.

littlemizjewl
littlemizjewl

@Roberto Corso Campos It is insured up to a million dollars actually. All riders who* use* Lyft are not stupid and it is actually cheaper than a cab or taxi. Lyft drivers do contribute to the community as they are spending various hours in the city limits and buying things like food and what not. They are supporting the economy if you want to get realistic, they also purchase gas and other amenities while they work and all cars are inspected and all drivers are regulated and have more extensive background checks than taxis. Based on what I have heard, only about 3% of people who apply to be Lyft drivers actually pass the stringent requirements.

sanfrancisco
sanfrancisco

@Roberto Corso Campos Actually, the company A) provides a million-dollar insurance policy that covers passengers, third parties and property damage, B) drivers are required to pay taxes and C) cars are inspected before they're approved ...

laughtiger
laughtiger

@Thomas Mulhern Have you even used Lyft? Basically the whole fare is treated as a "tip". So if you pay $15 to go across town, that is all tip, and legally should all go to the driver.

 Of course, the whole "donation instead of fare" position Lyft has tried to take was to skirt the law and avoid responsibility to its drivers in the first place. It is a bit ironic that this has led them into another kind of illegality which they apparently did not foresee.


Anyway, expect them to drop the "suggested donation" pretense in the near future, as it no longer does them any good. The state has rejected the idea that they are "ridesharing", so they might as well start openly charging a fare.

laughtiger
laughtiger

@Lauren Larsson "The government has been in the taxi unions' pocket."

The lack of any awareness of reality in that statement is truly shocking. Taxi unions are essentially powerless, essentially because they are treated as independent contractors instead of employees. Meanwhile, Lyft and companies like it are backed by millions of dollars in venture capital. Who do you think really has the government in their pocket? Hint -- the side with money...

The suit against Lyft could help the situation for all taxi drivers (not just those driving for Lyft and similar companies), if it leads the courts to enforce workplace protections. Improved working conditions for drivers leads to better service in the long run.

Wes_Anderson
Wes_Anderson

@Rob Blomberg Actually, Mr. Bloomberg, it is more likely that is it the other way around.  I wonder how many pockets were lined with lyft's $63 million in venture capital startup at the CPUC, the Mayor's Office and the MTA to allow them to operate without having commercial registration or commercial insurance?  I am pretty certain no cab company has $63 million to throw around like lyft does... Talk about corporatocracy;  being able to use VC start up money to displace workers in an industry, most of whom are thousands of hard working first generation immigrants, the whole lyft phenomenon reeks of tech elitism and unfair competition...


Now Trending

From the Vault

 

©2014 SF Weekly, LP, All rights reserved.
Loading...