New Jersey is seeking more than $640M from Uber in taxes and penalties, saying the ride-hailing company misclassified its drivers as independent contractors.
The move was hailed as a victory by those pushing for better working conditions for Uber’s drivers. Many of Uber’s workers are part-time, but others work long hours and rely on ride-hailing as their sole source of income.
New Jersey has among the strictest tests for determining whether a worker qualifies as an independent contractor. To be considered an independent contractor requires meeting all three prongs of a test set up under state law, including that the services performed fall outside the employer’s usual course of business.
The New Jersey Department of Labor and Workforce Development declined to discuss the case or say whether it is seeking similar restitution from Lyft or other gig economy companies. Lyft, which is also based in San Francisco, declined to comment.Uber’s shares closed Thursday at down 72 cents, or 2.7%, at $25.99. Lyft shed $1.38, or 3.2%, to $41.92. Both stocks are 42% below their initial public offering prices from earlier this year.
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