State & Local News
New Jersey Enforces Worker Classification Settlement
March 13, 2026
The New Jersey Department of Labor and Workforce Development (NJDOL) and the New Jersey Office of the Attorney General (OAG) have secured a landmark $7 million settlement with PDX North, Inc. for misclassifying over 1,000 delivery drivers as independent contractors. This enforcement action underscores New Jersey's commitment to upholding labor laws that protect workers' rights and ensure fair competition in the last-mile delivery sector. Procurement professionals and contractors operating in New Jersey should be aware of the heightened scrutiny on worker classification practices, as noncompliance can lead to significant financial penalties and legal challenges.
- Why this matters: Agencies and contractors must ensure compliance with state labor laws regarding worker classification to avoid costly settlements and reputational risks.
- This settlement sets a precedent for enforcement actions targeting misclassification in logistics and delivery services, a growing area of government contracting.
- Procurement teams should evaluate contractor labor practices during vendor due diligence to mitigate risks associated with misclassification.
- Businesses providing last-mile delivery services in New Jersey may face increased regulatory oversight, impacting contract eligibility and operational costs.
This settlement reflects New Jerseyโs strong commitment to protecting workers and ensuring employers meet their legal obligations. Worker misclassification denies employees critical benefits and protections and undermines fair competition for businesses who follow the law.
— Kevin D. Jarvis, Acting Labor Commissioner
Misclassifying workers raises costs for workers, taxpayers, and law-abiding businesses, which many of them can hardly afford. Combating worker misclassification is a critical part of our efforts to make our state more affordable for all New Jerseyans.
— Jennifer Davenport, Attorney General
Agencies
New Jersey Department of Labor and Workforce Development, New Jersey Office of the Attorney General
Vendors
PDX North, Inc.