When you drive for a living in New Jersey — whether it's for Lyft, Uber, or another gig platform — your work is more than just a way to get by. It's long hours on the road, unpredictable schedules, and often, no safety net if something goes wrong. For years, rideshare drivers in New Jersey claimed they were being misclassified as “independent contractors,” leaving them without access to basic protections like unemployment insurance, family leave, or workers’ compensation.

In September 2025, the New Jersey Department of Labor and Workforce Development (NJDOL) and Attorney General Matthew J. Platkin announced a major victory: Lyft agreed to pay over $19 million after an audit revealed that the company had failed to properly classify more than 100,000 drivers between 2014 and 2017. That misclassification allowed Lyft to avoid making required contributions to unemployment, disability, and family leave funds — depriving drivers of benefits when they needed them most.

This case sends a powerful message: New Jersey will not tolerate worker exploitation. And for drivers across Hudson, Essex, Bergen, and Passaic Counties, it's a reminder that you may have more rights than your employer claims. At Khorozian Law Group, our attorneys have represented countless workers as a trusted work injury lawyer in New Jersey — fighting for benefits, compensation, and accountability.

NJ Law and Employee Misclassification

New Jersey uses the ABC Test to determine if a worker is an independent contractor or an employee. Under this strict test, most workers are considered employees unless the employer can prove otherwise.

When workers are misclassified, they lose critical rights such as:

• Minimum wage and overtime pay.

• Workers’ compensation benefits.

• Unemployment insurance.

• Family and medical leave protections.

• Workplace safety and equal pay rights.

Employers who misclassify workers avoid making mandatory contributions, leaving “good actor” employers to carry the burden. As Labor Commissioner Robert Asaro-Angelo stated, this practice “imposes a financial toll on both employers and misclassified workers.”

Details of the Lyft Settlement

• Audit Triggered by Workers: Claims for unemployment and disability benefits revealed Lyft had not made required contributions.

• NJDOL Findings: More than $10.8 million in unpaid contributions, plus $8.5 million in penalties and interest.

• Final Resolution: Lyft contested, then withdrew its appeal, paying the full $19.4 million.

• Funds Restored: The money went back into trust funds that support New Jersey's workers and employers.

Local Impact: Rideshare and Gig Workers in NJ

This settlement affects thousands of gig workers across Jersey City, Newark, Hackensack, and Paterson. For them, misclassification has meant years without benefits they should have had access to.

• Rideshare drivers may be entitled to protections as employees under NJ law.

• Delivery and app-based workers could qualify for workers' comp and unemployment coverage.

• Workplace protections extend beyond traditional jobs, and gig workers are not exempt.

At Khorozian Law Group, we have stood up for employees misclassified by their employers. Whether you're a delivery worker in Newark or a rideshare driver in Bergen County, our attorneys can guide you like a seasoned New Jersey injury lawyer — making sure your rights are enforced.

FAQs About Misclassification in New Jersey

🔹 What does it mean if I was misclassified as an independent contractor?
It means you may have been denied benefits like workers' comp, unemployment, or family leave that you were entitled to as an employee.

🔹 How do I know if I was misclassified?
Under the ABC Test, if your work is controlled by the company, is part of its regular business, and you don't run your own independent business, you're likely an employee.

🔹 What are the benefits of hiring a work injury lawyer close to my workplace in New Jersey?
A local work injury attorney understands New Jersey labor laws and can recover damages for lost wages, denied benefits, and medical costs.

How Khorozian Law Group Protects NJ Workers

At Khorozian Law Group, we fight for employees who have been denied their rights through misclassification. Our attorneys:

• Review whether you qualify as an employee under New Jersey law.

• File claims for unpaid workers’ compensation benefits.

• Seek damages for lost wages, medical bills, and denied protections.

• Represent you before the NJDOL or in court if necessary.

If you or someone you know has been misclassified by an employer, don't face it alone. Call (201) 944-9200 or Contact Us online today for a free consultation.