By: Richard L. Smith
New Jersey officials have reached a $7 million settlement with an automotive parts delivery company after investigators found that hundreds of drivers were improperly classified as independent contractors.
According to a statement released by the New Jersey Attorney General’s Office, the agreement resolves a years-long dispute involving PDX North, Inc., a last-mile auto parts distribution company that operates in the state.
Authorities said more than 1,000 delivery drivers were misclassified as independent contractors instead of employees, which prevented them from receiving benefits and protections required under New Jersey labor laws.
Under the settlement, PDX will pay $7 million to resolve the violations and has agreed to reclassify its delivery drivers as employees.
The company will also begin paying into the state’s unemployment and disability insurance systems and must comply with all wage, tax, and benefit laws.
Officials said the case stems from multiple audits conducted by the New Jersey Department of Labor and Workforce Development that reviewed the company’s employment practices between 2006 and 2019.
State officials noted the agreement follows years of litigation, including challenges filed by the company in federal court that were ultimately dismissed.
Under the terms of the settlement, PDX must remain in compliance with state labor laws and will continue to be subject to state audits as part of the agreement.