Los Angeles, CAAnother California labor lawsuit has been filed against Lyft, this one accusing the company of breach of contract. The California labor claim alleges Lyft defrauded new drivers by failing to pay them a promised bonus for signing up with the company. An earlier California labor lawsuit has already been filed against Lyft alleging its drivers are classified as independent contractors when in fact they are employees.
The plaintiffs in the most recent claim allege in court documents that in an effort to increase the number of drivers at its disposal, Lyft offered $1,000 driver referral programs. In one program, a current driver could refer a new driver and both would receive $1,000 if the new driver had applied to be a driver on or after February 25 and completed their first ride by March 5. In the second promotion, new drivers could sign up without being referred, enter a code word and receive $1,000.
The referral programs were reportedly so well received they ended early in Los Angeles. When new drivers apply for a job with Lyft, they must take a “welcome ride” and then pass a background check in that order. The plaintiffs allege that despite drivers filling out their application and completing their welcome ride, Lyft’s background checks were not processed quickly enough to allow new drivers to give their first ride by March 5. Some drivers reportedly waited one to two weeks for a background check.
“As we’re processing the applications, it’s important that we continue to fulfill our safety obligations,” a March 4th e-mail from Lyft reportedly states. “Some of these steps, including DMV and background checks, are outside our control and can vary in length for different applicants. It is possible that you won’t qualify for the promotion if all steps aren’t completed by the March 5th deadline, along with the ride requirement.”
In a follow-up e-mail, Lyft extended the deadline for the first ride to March 12, but only for those drivers who had passed their background checks by March 5. Those who had applied before the program was closed but did not have their background check passed missed out.
“Lyft’s actions caused outrage throughout the Lyft community, with many referring drivers and new drivers believing the entire promotion had been a scam to attract new drivers without having to pay them $1,000,” court documents state.
Plaintiffs in the lawsuit allege breach of contract and fraud. They seek class-action status. The lawsuit is case number 3:15-cv-01159, in the US District Court for the Northern District of California.
Lyft, an on-demand ride-sharing company, already faces a California labor lawsuit alleging the company misclassifies drivers as independent contractors instead of as employees.