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| Jeenah Moon for The New York Times |
The move by
New Jersey could reverberate across the gig economy.
By Matthew Haag and Patrick McGeehan
·
New Jersey has demanded that Uber pay $649 million for years of
unpaid employment
taxes for its drivers, arguing that the ride-hailing company has
misclassified the workers as independent contractors and not as employees.
The state’s Department of Labor and Workforce Development issued the request this week to Uber and a subsidiary, Raiser, after an audit uncovered $530 million in back taxes that had not been paid for unemployment and disability insurance from 2014 to 2018. Because of the nonpayment, the state is seeking another $119 million in interest.
The
case represents a major escalation in how states nationwide view the employment practices at the core of many app-based companies, and the first
time that a local government has sought back payroll taxes from Uber, which has hundreds of
thousands of drivers in the United States.
A
spokeswoman at Uber said the company disputed the state’s findings.
“We are challenging this
preliminary but incorrect determination, because drivers
are independent contractors in
New Jersey and elsewhere,” the spokeswoman, Alix Anfang, said.
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