NZ Government advise legal changes to contractor rights

Published 24 July 2024 | 2 min read

The ongoing court battle involving Uber drivers has thrust New Zealand’s contractor employment status laws into the spotlight. This high-profile case questions whether Uber drivers should be classified as employees or contractors, prompting government officials to reconsider the current legal framework. Discussions are underway to potentially remove the right for contractors to challenge their employment status, a move that could significantly alter the landscape of employment law in New Zealand.

Far-reaching implications of legal reforms

Changing such a fundamental aspect of employment law will undoubtedly have wide-ranging effects. Employers, employees, and contractors alike will need to navigate a new legal terrain, potentially altering the nature of their relationships. The proposed changes could create more certainty for businesses, but they may also introduce unforeseen consequences. Employers must carefully weigh these implications to maintain fair and productive work environments.

Legal changes being prepared and minister's views

Workplace Relations and Safety Minister Brooke van Velden has been at the forefront of these discussions, confirming her consultations with various stakeholders, including Uber. Her intent is to gather a wide range of perspectives to shape the policy.

Key changes we might see

• Narrowing the legal framework: The new legislation might focus more strictly on the initial contracting intention, reducing the weight of factors like control, integration, and fundamental role in the business.
• Increased certainty: Businesses and workers would have clearer definitions of their relationship, potentially reducing litigation.
• Potential exclusion from court challenges: Contractors who explicitly agree to their status may no longer have the right to contest it in court.

Minister van Velden emphasised the significance of these changes:

“The implications of the potential changes required to achieve this are significant, and will impact a range of working relationships across the New Zealand economy. They will need to be carefully considered.”

Future benefits of legal clarity

Despite concerns, these legal reforms could lead to a more stable and predictable business environment. Employers will benefit from reduced legal ambiguities, allowing them to focus on growth and development without the looming threat of employment status disputes. Clearer definitions will streamline contract negotiations and foster a more transparent working relationship between businesses and contractors.

As the government moves forward with these reforms, New Zealand’s business community must remain adaptable and well-informed. By understanding and preparing for these changes, employers can turn potential challenges into opportunities for growth and stability.