The gig economy has seen the introduction of a widescale labour market characterised by short-term contracts or freelance work (as opposed to permanent jobs). Instead of a regular wage, workers in the gig economy get paid for the ‘gigs’ they do, such as food delivery or transportation (eg. Uber and Ola).
The employment status of workers in the gig economy remains unclear, both in New Zealand and internationally. Here, there are currently two recognised classes of worker: an employee who is afforded employment rights and minimum entitlements under employment related legislation, and an independent contractor who has no minimum entitlements or employment rights protection.
‘Employee status’ is determined by the real nature of the relationship, taking into account all relevant circumstances. The contractual documentation and label given to the relationship is just one part of that. A court will look at the degree to which the person is integrated into the business and the level of control the organisation has over the person. As well as that, a court will consider whether, fundamentally, the person was in business on their own account.
As many businesses look to operate in ways that allow greater flexibility and agility, the gig economy has seen a dramatic increase in the number of workers who don’t fit neatly into the traditional moulds. This has led to calls, both locally and overseas, for a new category of worker to be recognised. The ‘dependant contractor’.
While there was initially some suggestion that the Government planned to introduce statutory support and legal rights for dependant contractors, it has yet to announce if, and when, legislation defining, and providing for, this category of worker will be put forward. Until then, the test for who is afforded statutory employment related rights and entitlements remains as it is.
