Lyft fined $2.1 million for misleading ads about how much drivers could make

The Federal Trade Commission (FTC) announced Friday that ride-sharing company Lyft has agreed to pay $2.1 million as part of a proposed settlement.

The company regularly advertised that drivers could earn “certain hourly amounts” – in one case it claimed an hourly wage of “up to $33” for driving in Atlanta – based not on an average but on the salary of the top Fifth of the drivers were based, according to the commission. The company apparently also included tips in these figures.

Such actions “inflated most drivers' actual earnings by up to 30%,” writes the FTC, which says the company must now base potential salary claims on what drivers normally earn instead. And tips can no longer be included in these amounts as part of the stated hourly wage.

“It is illegal to lure workers with misleading information about how much they will earn at work,” said FTC Chairwoman Lina M. Khan. “The FTC will continue to use all of its tools to hold companies accountable when they break the law and exploit American workers.”

The FTC listed examples of Lyft's offensive ads in its complaint, such as the following.

Screenshots: United States v. Lyft, Inc. Proposed Order

Screenshots: United States v. Lyft, Inc. Proposed Order

Lyft also apparently promoted earning guarantees, such as $975 for completing 45 rides in a weekend. But they also misled drivers who thought they were receiving the amount as a bonus on top of their earnings, when in fact, according to the FTC, the offer was a conditional minimum wage guarantee for completing a certain number of trips. The company is now obliged to clarify this matter.

Here is the suggested order:

In a statement on its website, Lyft highlights recent changes to tell drivers how much they can earn and says it is “committed to following FTC best practices” when submitting such details.

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