When Lyft faced a driver shortage in 2021, the ride-hailing company launched a major marketing campaign to lure drivers with eye-catching earnings — up to $43 an hour in Los Angeles, $41 in Portland and $33 in Atlanta, according to the Federal Trade Commission.
What these advertisements failed to mention was that only 1 in 5 drivers were actually making these rates, the FTC said.
On Monday, the agency and the Department of Justice announced that Lyft had agreed to pay a $2.1-million civil penalty to settle a complaint alleging that it made false and misleading statements about drivers’ earning potential and to refrain from making such claims in the future. As the complaint was brought by the government, the penalty will be paid to the U.S. Treasury and drivers will not see any of the money.
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FTC Commission Chair Lina Khan pointed out that, in the absence of salary or a set hourly pay rate, workers rely on gig companies’ marketing to gauge their earning potential. Khan issued a statement alongside Commissioners Rebecca Kelly Slaughter and Alvaro Bedoya.
Nov. 4, 2024
“The stakes are high. Americans are making serious life decisions — such as whether to leave a job or forgo an opportunity — and their livelihoods are on the line,” the commissioners stated. “Unfortunately, the FTC’s work here shows that unfair or deceptive practices are all too...
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