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

The Federal Commerce Fee (FTC) introduced Friday that rideshare firm Lyft has agreed to pay $2.1 million as a part of a proposed settlement that requires it to vary the way it advertises driver pay.

The corporate routinely marketed that drivers might make “particular hourly quantities” — in a single occasion, claiming earnings of “as much as $33” per hour for driving in Atlanta — that have been based mostly not on a mean, however on what the highest fifth of drivers made, based on the Fee. The corporate additionally apparently included ideas in these figures.

Such strikes “overinflated the precise earnings achieved by most drivers by as a lot as 30%,” writes the FTC, which says the corporate now should base potential pay claims on what drivers usually make, as an alternative. And people quantities can now not think about ideas as a part of said hourly pay.

“It’s unlawful to lure employees with deceptive claims about how a lot they’ll earn on the job,” stated FTC Chair Lina M. Khan. “The FTC will maintain utilizing all its instruments to carry companies accountable after they violate the legislation and exploit American employees.”

The FTC included examples of Lyft’s offending advertisements in its criticism, akin to these under.

Lyft additionally apparently promoted earnings ensures, akin to one promising $975 for finishing 45 rides in a weekend. However these additionally misled drivers, who thought they’d be getting the quantity as a bonus on prime of what they earned, when the provide was truly a conditional minimal pay assure for doing a set variety of rides, based on the FTC. The corporate is now required to make that reality clear.

Right here is the proposed order:

In a press release on its web site, Lyft highlights modifications it has made lately to inform drivers how a lot they will earn and says it’s “dedicated to following the FTC’s finest practices” when speaking such particulars.