Labor & Employment Law Daily Wrap Up, BENEFITS NEWS—Lyft pays NJ labor department over $19M as result of driver misclassification, non-contribution to funds, (Sep 22, 2025)
Organizations Mentioned:Lyft, Inc.
By Brandi O. Brown, J.D.
Claims by drivers for benefits led the New Jersey Department of Labor to conduct an audit, which uncovered the employer’s failure to make required contributions.
Last week, New Jersey’s Attorney General Matthew J. Platkin announced that ride-share company Lyft had submitted $19,435,087.06 in payments to the New Jersey Department of Labor and Workforce Development’s (NJDOL’s) unemployment, temporary disability, family leave insurance trust funds, and workforce development funds after an audit determined that Lyft improperly classified over 100,000 drivers as independent contractors and, as a result, failed to make required contributions to the state funds from 2014 to 2017.
“We will not allow businesses to exploit workers by misclassifying them, stripping employees of essential benefits and avoiding their responsibility to support programs that protect our workforce,” said New Jersey Attorney General Matthew J. Platkin.
Audit. Claims made by Lyft drivers triggered an audit that revealed the employer’s failure to make contributions. Lyft was assessed more than $10.8 million in past due contributions, plus penalties and interest of $8.5 million. Initially, although it paid the $10.8 million to stop the running of interest, Lyft contested NJDOL’s findings, and the case was transmitted to New Jersey’s Office of Administrative Law (OAL) for a hearing. However, it later withdrew its request and paid the remaining balance owed.
“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,” said New Jersey Labor Commissioner Robert Asaro-Angelo. “Although many allege that being an employee stifles flexibility, this couldn’t be further from the truth. There is no reason temporary or on-demand workers who work flexible hours, or even minutes at a time, can’t be treated like other employees.”
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