Lyft cheated new drivers out of promised $1,000 bonuses, stated a federal class-action lawsuit announced Friday.
Hundreds of drivers lost a total of at least $5 million worth of bonuses offered in promotional deals in major U.S. cities, said the lawyers who filed the breach-of-contract and fraud lawsuit on Wednesday, according to The Associated Press.
The San Francisco-based ride sharing company had promised the bonuses if drivers could recruit new riders, said the 22-paged complaint.
A driver could split $2,000 between him or her and a friend, the promotion deal claimed. Lyft also offered a $1,000 sign on bonus, allowing new drivers to sign up and earn the money without referrals. Drivers had to sign up for the promotion by Feb. 25 and complete their first rides by March 5.
Thousands of applications poured in as a result of the promotions and Lyft was unable to handle the large volume, quickly ending the promotions after March 5.
According to the lawsuit, Lyft also processed the applications too slowly for drivers to make the March 5 deadline. The company had to conduct background checks on each applicant, which would take at least one to two weeks to process.
“Lyft’s actions caused outrage throughout the Lyft community,” stated the lawsuit, with many drivers “believing the entire promotion had been a scam.”
Users took to the Internet to complain, calling the situation “Lyftgate.”
