Uber Technologies Inc. paid $100 million to New Jersey to resolve allegations of misclassifying its drivers and failing to pay unemployment insurance taxes, the state’s labor department said Tuesday morning.
The payment is the latest big company payout in the wide-ranging legal battle over the employment status of rideshare and delivery drivers. Companies such as Uber, Lyft Inc.,Doordash Inc., and Grubhub Inc. routinely classify their drivers as independent contractors.
Workers in this category don’t qualify for the legal protections and workplace benefits available to those who are deemed employees, including minimum wage and overtime laws, unemployment insurance, workers’ compensation, and the federally protected right to form or join a labor union.
Uber’s payment is a fraction of the more than $600 million in unpaid UI taxes plus interest and penalties assessed against San Francisco-based Uber and its New Jersey subsidiary Rasier LLC that Bloomberg Law first reported in 2019. Documents Uber provided on Tuesday indicate the initial assessment was even higher, at more than $1 billion for the two companies combined.
READ MORE: Uber’s Driver Tax Dilemma Highlights Growing Legal Threat
Uber and its subsidiary aren’t required to change the way they classify drivers or to begin paying into the state’s UI trust fund going forward.
At the same time, New Jersey officials...
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