Another Uber Setback

Now that governments are no longer terrified of Uber, much of the regulatory forbearance that has been essential to the success of their business is ending.

Case in point, New Jersey is now demanding back taxes and fines in the amount of $650,000,000.00:

Uber Technologies Inc. has been hit with an almost $650 million bill in unpaid employment taxes and fines from New Jersey, marking another setback for the ride-sharing firm as it struggles to prevent its drivers from being classified as employees.

Earlier this week, the state’s Department of Labor and Workforce Development demanded Uber and a subsidiary, Rasier LLC, hand over the amount for failing to pay employment taxes by, the state argues, misclassifying drivers as independent contractors.

The Labor Department said in letters sent to the firms that they owe $523 million in unemployment and disability insurance taxes for 2014 through 2018. The state added $119 million in penalties and interest.

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New Jersey officials say that misclassifying employees isn’t fair to workers. They also estimate that misclassification across the workforce costs the state’s almost 250,000 employers an additional $300 per employee because of insufficient funding of the state’s unemployment insurance trust fund.

This is a company whose business plan was dependent on impunity for law breaking for their success, and now that regulators are no longer looking the other way, they are in a world of well-deserved hurt.