Lyft has paid $19.4 million to New Jersey after an audit found the ride-sharing company improperly classified more than 100,000 drivers as independent contractors, state officials said on Thursday.
Officials including state Attorney General Matthew Platkin said Lyft made the payment after withdrawing its request for a hearing to challenge an audit by New Jersey’s Department of Labor and Workforce Development of its books and records from 2014 to 2017.
New Jersey said its audit found Lyft did not make contributions to state funds for those years on behalf of drivers, depriving them of protections such as unemployment compensation, temporary disability benefits and family leave.
Lyft was assessed more than $10.8 million in past-due contributions, plus more than $8.5 million of penalties and interest. It paid the $10.8 million to stop interest from running, and paid the remainder after ending its challenge.
The San Francisco-based company reached a similar $27 million settlement with Massachusetts in June 2024.
In a statement, Lyft said it still believes it classified drivers properly under New Jersey law, and that drivers overwhelmingly prefer working on their own terms rather than as employees.
“While we disagree with the NJDOL’s findings, we will not be pursuing further challenges to the assessment,” it added.
Many regulators have over the last several years said Lyft and rival Uber’s alleged misclassifications also deprive drivers of other benefits including a minimum wage, overtime pay and sick leave.
“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,” New Jersey Labor Commissioner Robert Asaro-Angelo said in a statement.
