The Federal Trade Commission (FTC) has initiated an investigation into ride-sharing giants Uber and Lyft over allegations of collusion to suppress driver compensation in New York City. On 21 January 2025, the FTC issued civil investigative demands to both companies, seeking information about their compensation agreements with New York City officials.
The probe centers on a July 2024 agreement between Uber, Lyft, and New York City officials aimed at reducing ride-share “lockouts”—a practice where drivers are temporarily prevented from accessing the app, thereby limiting their earning potential. While intended to address driver availability, concerns have arisen that this agreement may have led to coordinated actions between the two companies, potentially violating antitrust laws.
Both Uber and Lyft have denied any illegal coordination. Uber’s spokesperson stated, “We are confident that our actions here were reasonable and appropriate under New York City rules,” emphasizing the company’s intent to cooperate fully with the FTC. Similarly, a Lyft representative affirmed the company’s commitment to federal antitrust laws and its readiness to provide the requested information.
This investigation reflects a broader trend of regulatory scrutiny toward gig economy companies. In October 2024, Lyft agreed to pay a $2.1 million fine to settle charges by the FTC over misleading advertisements about driver earnings. Additionally, in December 2024, Grubhub settled for $25 million following allegations of deceptive business practices affecting both consumers and drivers.
The outcome of the FTC’s investigation into Uber and Lyft could have significant implications for the gig economy, potentially leading to substantial fines and mandated changes to compensation models if evidence of collusion is found.
