Lyft reaches $272.5 million California driver misclassification settlement
LYFT•Lyft reached a settlement, pending court approval, to resolve claims over the classification of California drivers from April 5, 2016, to Dec. 15, 2020. The settlement totals $272.5 million, and Lyft recorded a $210 million Q4 2025 accrual tied to the matter.
1. Settlement terms
Lyft reached a settlement, pending court approval, to resolve claims that it misclassified California drivers as independent contractors from April 5, 2016, to Dec. 15, 2020. The total cost is $272.5 million, inclusive of attorneys’ fees, costs and expenses.
2. Payment and guidance
Lyft can pay the settlement over four years. Simple interest of 5% accrues after the first year, capped at $12.4 million. The company recorded a $210 million accrual in Q4 2025, excluded from Adjusted EBITDA; its third-quarter 2026 guidance for Gross Bookings, Adjusted EBITDA and margin was unchanged as of Sept. 30, 2026.
