Judge Gives Lyft Something to Worry About Ahead of Its IPO

Members of the Independent Drivers Guild
Members of the Independent Drivers Guild
Photo: Drew Angerer (Getty)

Back in December, New York City approved the nation’s very first minimum wage pay floor for app-based drivers—a historic victory Lyft undercut almost immediately by challenging its implementation in court. Today, drivers got more good news when a judge denied Lyft’s motion for an injunction that would block the minimum wage for its drivers.


The pay floor itself would set a rate of $17.22 per hour (after expenses) for drivers in one of Lyft’s biggest markets. For its part, Lyft argues the requirement to shell out a living wage would tip the scales in favor of its rival, Uber, which is currently both bigger and richer. “It’s no secret that Uber has tried to put us out of business in the past,” the company wrote ahead of its initial filing. “They’ve failed repeatedly, and the TLC [Taxi and Limousine Commission] should not assist them in their efforts.”

“We are pleased the judge denied Lyft’s motion to block the wage protection rules for now,” Lyft driver and Independent Drivers Guild member Tina Raveneau wrote in a statement to press today. “Eighty thousand New Yorkers serve as professional drivers for apps like Lyft and we deserve the protection and the dignity of a livable minimum wage.”

The judge is expected to deliver a written statement within the next 30 days—timing which is less than ideal for Lyft. The company filed its initial public offering at the beginning of this month and now, as the company begins to court investors for its nearly 30.8 million shares and seeks a valuation between $21 and $23 billion, an unfavorable outcome in one of its largest markets could potentially hurt its stock price, which is expect to land around $65 each.

“We support the New York City Council’s minimum earnings goal, but oppose the TLC’s specific rules because they actually hurt earning opportunities for drivers, and provide advantages to certain companies over others,” a Lyft spokesperson wrote to Gizmodo in a statement. “We appreciated the opportunity to make our case in court today, and look forward to the judge’s forthcoming ruling.”

Updated with statement from Lyft. Small clarification in lede.

Senior reporter. Tech + labor /// bgmwrites@gmail.com Keybase: keybase.io/bryangm Securedrop: http://gmg7jl25ony5g7ws.onion/



This is higher than the city’s current minimum wage isn’t it? I thought the min wage for New York City was going to $15/hr by the end of the year. It seems strange the court would impose higher min wage for app-based drivers than for all of the other jobs in the state. They made this law specific to only this industry so Cab and limo drivers are still going to have a lower min wage. Of course the TLC would love this move since they wouldn’t be subject to this law and it would allow them to be more competitive without doing anything. I am not going to argue what the wage should be just that it is weird to have different wage floor focused on part of an industry while leaving the rest out. It would like like increasing taxes for just AirBNB rentals and forcing them to be taxed higher than hotels. (obviously that example is taxes and not wages, no need to point that difference out as it an example in mandating different costs for the same industry). I am just saying that imposing higher wages to one type of business and not the other does not seem exactly fair. Why didn’t they just include all drivers in the mix so limo and taxi drivers get to share from this increase in wages? Maybe it boils down to how the industries log hours, I am not familiar if they are considered clocked in the entire time or just when they have a passenger.