Uber fined $650m for saying drivers not staff

New Jersey^[1] has demanded that Uber^[2] pay $649 million for years of unpaid employment taxes for its drivers^[3], arguing that the ride-hailing firms has misclassified the workers as independent contractors^[4] and not as employees^[5].
The state’s labour department 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^[6] from 2014 to 2018. Because of the nonpayment, the state is seeking another $119 million in interest. Worker advocates say that job classification hurts the labourers and the states where they live, which miss out on tax revenues.
The case is the latest setback for Uber and other firms in the so-called “gig economy”. It represents the first time a local government has sought back payroll taxes from Uber. Uber disputed the state’s findings. “We are challenging this preliminary but incorrect determination, because drivers are independent contractors in New Jersey and elsewhere,” the San Franciscobased firm said.

References

1. ^{^} New Jersey (www.happytrips.com)
2. ^{^} Uber (timesofindia.indiatimes.com)
3. ^{^} drivers (timesofindia.indiatimes.com)
4. ^{^} independent contractors (timesofindia.indiatimes.com)
5. ^{^} employees (timesofindia.indiatimes.com)
6. ^{^} disability insurance (timesofindia.indiatimes.com)

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