Lyft will pay the New Jersey Labor Department more than $19.4 million to settle allegations from a state audit that found that the rideshare giant misclassified more than 100,000 workers as freelancers rather than regular employees, labor officials announced.
The Sept. 18 announcement came as state officials are exploring ways to overhaul the state’s independent contractor rules so that more freelancers would be considered regular employees.
Under that proposal, truckers, as well as Uber and Lyft drivers, and DoorDash and GrubHub drivers, could be considered regular company employees rather than gig workers.
“Misclassification imposes a financial toll on both good actor employers and misclassified workers, who lose critical rights such as minimum wage, overtime pay, workers’ compensation coverage, unemployment insurance, earned sick leave, family leave, and more,” New Jersey Labor Commissioner Robert Asaro-Angelo said Sept. 18 in a statement.
The $19.4 million payment is broken down into $10.8 million for unemployment, family leave and disability taxes that Lyft allegedly skipped out on between 2014 and 2017, as well as $8.5 million penalties and interest, labor officials said.
“While we disagree with the [New Jersey Department of Labor]’s findings, we will not be pursuing further challenges to the assessment,” Lyft spokesperson CJ Macklin said in an emailed statement Monday morning.
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