Lyft says the New York City Taxi and Limousine Commission's new minimum wage rules could hurt its business — and the ride-sharing company is suing.
The new policy, which is expected to go into effect on Feb. 1, would set the minimum take-home wage for drivers at $17.22.
Lyft's biggest issue was that the new minimum wage was calculated using a set "utilization rate."
The utilization rate is the ratio of customers in a company's cars to the number of cars on the road. To make sure drivers are actually making the new minimum wage, companies will have to pay some drivers extra on top of what they earn from passengers. Companies with a higher ratio of customers per car, like Uber, will have to pay drivers less. Companies with fewer customers per car will have to shell out more, hurting their bottom lines.
In the petition, Lyft argues that "instead of setting an industry-wide utilization rate ... the rule allows any company to use its own company specific utilization rate."
Due to this, Lyft has asked the court to "vacate" the law.