ACT party leader, David Seymour, recently announced a proposal to have the Employment Relations Act amended so that independent contractors may not be regarded the same as employees and thus unable to challenge their employment status in court.
This proposal comes months after the Employment Court made a judgement in favour of Uber drivers who wanted to be recognised as employees and not just contractors. The landmark decision allows them to qualify for the same rights and protections as employees, including the right to holiday pay, sick leave, and a minimum wage requirement.
The ACT’s proposed policy document disagrees with the Employment Court’s decision, saying that if the judgement is upheld, it would result in many businesses shutting down. The party is instead proposing that contractors should have their employment status specified in writing, with the workers being provided with enough opportunity and information to seek advice before entering into contracts.
The proposal is also recommending some protections such as having businesses keep detailed records of their compliance with minimum entitlement provisions, ensuring contractors are not terminated for not accepting specific tasks, and not allowing restriction of workers’ opportunities to work for other businesses outside of the period of their contracts.
BusinessNZ, which represents the interests of business owners, is supporting the policy proposal, saying that it has merit. While Seymour has defended this plan, stating that contract work already offers the benefits of autonomy and flexibility for workers unable to commit to standard hours, other stakeholders have taken an opposing view.
While the government has paused plans to delve into contractor and employee definitions, Deputy PM and Workplace Relations and Safety Minister, Carmel Sepuloni, stated that ACT’s policy proposal would undermine the rights of workers. She criticised the party for attempting to place vulnerable workers in a more vulnerable position.
The New Zealand Council of Trade Unions (NZCTU) has echoed similar sentiments, stating that the policy would expose workers to exploitation and cause employees to be forced into contracts without fundamental rights. NZCTU National Secretary, Melissa Ansell-Bridges, is instead calling for reform that would prevent unscrupulous employers from taking advantage of workers and will prioritise their concerns and well-being. She called on elected representatives to ensure a fair and just labour environment. The E tū Union has also lambasted the proposal, saying that it would lead to worsening inequality and poverty.
Employment lawyer, Garry Pollak, said that even with cases such as the one filed by Uber drivers, employers would still face no problem when it came to hiring contractors as the law has always provided for that option. He noted that the availability of contractors continued to grow as there were businesses that wanted to avoid employment obligations.
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