Lyft’s minimum wage problem

In late January, just before New York City’s new minimum wage requirements for app-based ride hail drivers were set to go into effect, Lyft sued to block the law. In doing so, the company broke its government-friendly streak that distinguished it from Uber.

Although Lyft opposed the new minimum wage, the company argued that it supported the principle – just not the method used by the Taxi and Limousine Commission to calculate the minimum pay rate. The TLC set a utilization rate that is calculated by dividing the amount of time drivers spend actually driving passengers by the time they spend on the app waiting for rides. Both Lyft and Juno – which sued alongside Lyft in January – have lower utilization rates than Uber and they argue that this method unfairly discriminates against them because they will end up having to pay their drivers more. Lyft favors a minimum weekly pay standard.

Though Manhattan Supreme Court Judge Andrea Masley denied Lyft’s request for an injunction blocking the minimum pay rules, Masley said she would take 30 days to reconsider. Lyft will soon have her answer: Those 30 days were up on Wednesday. In the meantime, Lyft’s share of app-based rides continues to grow.