PHILADELPHIA (KYW Newsradio) — Ride-share company Uber has paid the state of New Jersey $100 million for misclassifying drivers.
An audit from the New Jersey Department of Labor and Workforce Development found that Uber misclassified nearly 300,000 drivers as independent contractors and, as a result, failed to make the appropriate contributions to unemployment, disability and family leave, and workforce development.
The company has submitted a $78 million payment in past due contributions to those funds plus penalties, and $22 million in interest, to the state’s Unemployment Trust Fund.
The New Jersey Office of the Attorney General calls it the largest payment of its kind in state history.
“We will not tolerate companies that misclassify their workers, thereby denying employees vital benefits and dodging their obligation to contribute to programs that benefit the workforce,” said Acting Attorney General Matt Platkin.
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“By misclassifying workers, companies both harm their employees and sidestep their obligations under the law. New Jersey will continue to enforce our employee misclassification laws aggressively to prevent such conduct. As the economy changes, we will vigorously defend workers’ rights.”
Uber has disputed the claims and has fought to keep the classification for drivers as independent contractors, limiting a drivers ability to seek rights afforded to full-time staffers.
The state initially said Uber’s underpayment was more than $500 million, but the audit settled at $100 million for fees and interest.