Modern Australian
The Times

Contractor or employee? How a proposed law change will favour Uber over its drivers

  • Written by Amanda Reilly, Senior Lecturer in Commercial Law, Te Herenga Waka — Victoria University of Wellington
Contractor or employee? How a proposed law change will favour Uber over its drivers

Ride share company Uber has faced legal challenges around the world over whether its drivers should be classified as employees or contractors. New Zealand is no exception, with the most recent case heard before the Supreme Court in July.

While the outcome of that case is not yet known, Uber stands to benefit from amendments to New Zealand’s employment law, currently under select committee review. As it has elsewhere, Uber actively lobbied the government for changes to the law, and one of the proposed amendments was suggested by the company itself.

If enacted, the suite of amendments would clarify the distinction between employment and contracting arrangements, alter how personal grievance remedies are assessed, introduce a high-income threshold for unjustified dismissal claims, and abolish the “30-day rule” for workplaces with collective agreements.

Under the proposed law, whether a worker is a contractor would depend on a “gateway test”. This covers whether the contract describes the person as a contractor, whether they can work for other companies, whether they are required to work specific shifts, and whether their contract can be terminated for declining extra work.

Presented as a way of clarifying the legal status of platform-based workers such as Uber or DoorDash drivers, the changes may end up making it easier for employers to misclassify employees – and is out of step with other countries.

The amendments also don’t address the range of problems associated with platform work, including fluctuating pay and arbitrary deactivation.

The changing nature of work

Under current New Zealand law, employees – those who work under the direction of an employer – are entitled to protections such as the minimum wage, paid sick leave and safeguards against unfair dismissal.

Contractors, by contrast, are considered to be in business on their own account and do not receive such protections. This creates an incentive for some employers to misclassify workers.

This is important, given the new forms of work that have emerged in the past decade. Platform workers on services such as Uber, Lyft and DoorDash don’t fit neatly into existing categories of employee or contractor.

For example, Uber has argued it’s not a transport provider and that it does not employ drivers per se, but merely connects them with passengers. It also claims drivers enjoy more freedom than traditional employees, as they are not required to log on to the app.

Drivers, however, argue they are in fact working for Uber’s business, not their own. They point to the company’s pricing controls and other restrictions as evidence that they are, in practice, employees.

The proposed law would resolve this dispute in favour of platform owners. It would allow companies to draft contracts that define workers as contractors on a “take it or leave it” basis – terms that may be difficult, if not impossible, to challenge.

Vulnerable contractors

It has long been acknowledged that some contractors are vulnerable. They may be economically dependent on a single client, or technically able to take other work but practically constrained from doing so.

These workers need more support and protection than the current law offers. Recognising this, other countries, including the European Union, have taken a different approach.

Australia, for example, has created a new category of “employee-like” workers. These are not employees, but are still entitled to protections such as the right not to be unfairly disconnected from a platform and the right to challenge unfair contract terms.

The new law would also affect more than just Uber drivers and other platform workers. It would impose regulatory costs on businesses, which would need to seek legal advice and review their contracting arrangements.

There is also a risk that some employers will rewrite contracts to avoid extending rights to casual workers who should be defined as employees.

Rather than preventing the misclassification of workers, the law changes may make it easier. They do little to address the challenges vulnerable contractors face, fail to tackle the structural problems of platform work, and disregard how other countries are modernising their laws.

Lynne Coker, Senior Lecturer at the Ara Institute of Canterbury, contributed to this article which is based on a forthcoming analysis in the New Zealand Journal of Employment Relations.

Authors: Amanda Reilly, Senior Lecturer in Commercial Law, Te Herenga Waka — Victoria University of Wellington

Read more https://theconversation.com/contractor-or-employee-how-a-proposed-law-change-will-favour-uber-over-its-drivers-262118

How Osteopathy Supports Recovery from Sciatica and Nerve Pain

Sciatica isn't just annoying. It's genuinely painful. It sits deep in your glute and shoots straight down the back of your leg. It turns something as...

The Winter Jewellery Edit: Five Pieces You'll Wear All Season

As wardrobes shift to cosy knits, tailored coats and rich seasonal textures, jewellery becomes the finishing touch that pulls every winter outfit to...

7 Signs It's Time to Upgrade Your Piston Air Compressor

If you run a workshop, panel shop, or fabrication business anywhere around Perth, you already know what heat and dust do to equipment over a few sum...

How Long Do Bathroom Renovations Melbourne Take? Step-by-Step Process Explained

Planning a bathroom renovation is exciting, but one of the biggest questions homeowners ask is, "How long will it take?" While every project is uniq...

Why Your Skin Breaks Out: The Science of Acne Explained

Acne is the most common skin condition in the world. An estimated 85% of people experience it at some point between the ages of 12 and 24, and a gro...

10 Swimwear Trends Australian Women Are Wearing This Summer

Every Australian summer brings a fresh wave of swimwear trends, but some styles have much greater staying power than others. While fashion constantly ...

Why Regular Skills Updates Are Essential for Licensed Security Officers

A guard at a Brisbane shopping centre gets a call about a shoplifter who's turned aggressive.  They’ve done the job for six years. But their de-...

10 Benefits of Choosing Professional Tutoring Penrith Services

Every student has unique learning strengths, challenges, and academic goals. While classroom teaching provides essential knowledge and structure, so...

Sunshine Coast Baby Classes Prove Big Hit Among First-Time Mums

There's a movement gaining traction on the Sunshine Coast, providing a village of support, socialisation and relief for first-time mothers and babie...

Father's Day Gift Ideas for Men Who Are Hard to Buy For

Some dads are easy to buy for. Others do not want anything, already have everything, or give you the classic "don't worry about me" answer every yea...

Top 5 Mistakes That Wear Out Your Brakes Faster

Brakes don't need frequent replacements like oil changes do.   But a lot of the wear happens quietly, over months, because of habits most drivers...

Plantation Shutters vs Curtains: Which Is Better for Your New Home?

Moving into a new home is an exciting opportunity to personalise your space and make it your own. While many homeowners focus on furniture, flooring...

Celebration of Life vs Traditional Funeral: What's the Difference?

When saying goodbye to someone you love, there is no single way to honour their life. Every family has different traditions, beliefs, and preference...

Building Approval for Roofing Projects: What Homeowners Need to Know

Roofing projects are an important part of maintaining and protecting your home. Whether you're repairing storm damage, replacing an ageing roof, or ...

Chatswood Tutoring And Its Role In Academic Achievement

Academic success often requires more than classroom attendance alone. Students face increasing expectations as they progress through school, particu...

Why Laser Hair Removal Treatments Continue Growing In Popularity

Managing unwanted hair can become time-consuming and frustrating for many people, especially when shaving, waxing, and other temporary methods requi...

Choosing the Right Devices for a Flexible Workplace

For IT leaders managing large fleets, the device layer is where workforce productivity and security policy meet. The shift towards flexible and hybrid...

How Business Advisory Services Help Companies Achieve Sustainable Growth

Every business owner aims to build a profitable and sustainable organisation. While dedication, innovation, and hard work are important, achieving l...