Ride-hailing company Lyft is currently being sued by one of its former drivers for allocating paid sick days as mandated by Washington DC law.
As per state law, a company’s employees have to receive paid sick leave if they are unable to work; however, ride-hailing services such as Lyft argue that their drivers are not in fact employees, but rather contractors, thus making the company exempt from mandatory paid leave. The former driver’s lawsuit challenges Lyft’s stance of the classification of its drivers, claiming that they are integral to the everyday operations of the business, and are thus entitled to Washington’s sick leave law.
Although Lyft is stating that they do in fact provide their drivers with compensation in the event that they are diagnosed with the coronavirus, but they will not re-classify their drives as employees as such a move could compromise the company’s access to other federal funding. However, the lawsuit is based on grounds that Lyft’s policy on paid sick leave is too vague, and thus does not meet the standards of DC law.
Information for this briefing was found via Bloomberg and Second Measure. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.