Uber Agrees to Pay New Jersey $100 Million in Dispute Over Drivers’ Employment Status
Workspan Daily
September 16, 2022

Uber has agreed to pay New Jersey $100 million in back taxes after the state said the ride-hailing company had misclassified its drivers as independent contractors, according to a report by the New York Times. 

An audit by the state’s Department of Labor and Workforce Development had found that Uber and a subsidiary, Raiser, owed four years of back taxes because they had classified drivers in the state as contractors rather than employees. On Monday, the department announced that Uber had paid the taxes with interest. 

The New Jersey Department of Labor and Workforce Development initially demanded payment of the back taxes from Uber in 2019, the first time a local government had sought back payroll taxes from the company. An audit had uncovered that $530 million in back taxes had not been paid for unemployment and disability insurance from 2014 to 2018, according to news reports. The state also demanded $119 million in interest. 

After Uber contested the department’s findings, the case was transferred to New Jersey’s Office of Administrative Law. Eventually, the company agreed to pay a revised figure and to drop its appeal. 

The payment covers as many as 91,000 drivers who have worked in New Jersey in one of the years covered by the settlement. It will help provide benefits such as unemployment, temporary disability and family leave insurance. 

“Our efforts to combat worker misclassification in New Jersey are continuing to move forward,” Robert Asaro-Angelo, the department’s commissioner, told the Times. “This shows that these workers in New Jersey are presumed to be employees. No matter what a company’s business model or what their technology is, workers have rights.” 

Survey: Canadian Employers Planning Average Salary Increase Budgets of 3.8% 

According to a survey by Normandin Beaudry, Canadian employers are still planning average salary increase budgets of 3.8%, excluding salary freezes, in 2023 — a rate higher than historical trends. The survey polled more than 750 employers and nearly 1.8 million employees. 

As reported by Benefits Canada, the survey found more than one in 10 organizations are planning average salary increase budgets above 5% and, in some cases, as high as 20%. Employers are continuously adapting to market pressures, with average salary increases granted in 2022 reaching 3.8%, exceeding the initial projections of 3.4% and 2.8% published in February 2022 and July 2021, respectively. 

Nearly half of employer respondents allocated an additional budget of 1.9% on average in 2022, higher than the initial forecast of 1.2%. Projections for next year revealed a third of organizations plan to grant an additional budget of 1.4% on average. 

Just 1% of respondents implemented a salary freeze in 2022 or noted they intend to in 2023.  

Amazon’s Workplace Safety Chief to Leave Next Month 

CNBC has reported that Amazon’s top executive overseeing workplace health and safety is leaving the company next month. 

Heather MacDougall, who joined Amazon in 2019 from the Occupational Safety and Health Review Commission, is departing the company on Oct. 7, according to a memo that John Felton, Amazon’s head of operations, wrote to employees on Monday. 

“After building with us for over three years as an important member of our leadership team, Heather has decided to pursue other opportunities outside Amazon,” Felton wrote in the memo, which was viewed by CNBC. “I want to thank her for her many contributions, and I wish her well on the next step in her journey.” 

MacDougall oversaw the health and safety of Amazon’s global workforce of 1.5 million-plus employees at a crucial period. In early 2020, as COVID-19 was spreading rapidly, causing businesses and office buildings to temporarily shutter, Amazon’s warehouse and delivery employees continued to report to work as consumer demand soared for rapid delivery. 

Workplace safety concerns are one major impetus behind the recent organizing wave at Amazon warehouses, according to CNBC, and Amazon has disputed reports of unsafe working conditions. During MacDougall’s tenure, the company set ambitious goals to reduce injuries, including a plan to cut recordable incident rates, an OSHA measurement covering injury and illness, by half by 2025. 

Becky Gansert, who currently serves as vice president of global specialty fulfillment, will replace MacDougall after her departure. 

NBA Suspends and Fines Phoenix Suns Owner $10 Million for Workplace Misconduct 

On Tuesday, the NBA suspended Robert Sarver, the owner of the Phoenix Suns and Mercury, for one year and hit him with a record $10 million fine after an investigation uncovered racist and sexist workplace conduct, according to an NBC News report. 

For the next year, Sarver will be barred from all NBA and WNBA buildings, including any office, arena, or practice facility,” the league said in a statement. 

He also wont be allowed to participate in any NBA or WNBA event, represent the teams in any capacity, have involvement in any team business or basketball operations or play any role in any league governance, the NBA said. 

The $10 million fine is the maximum allowed under league rules, the NBA said, and it is the biggest financial penalty ever handed down to one person in pro basketball history. 

The league probe was sparked by a Nov. 4, 2021 ESPN story chronicling long-standing allegations of racism and misogyny within the Phoenix basketball operation. 

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