So it is in the process of legislating a test that needs to be met for someone to be a “contractor”.
However, Workplace Relations Minister Brooke van Velden confirmed to Newstalk ZB she “wasn’t intending” for the test to be applied to the past.
Commenting on the issue, Finance Minister Nicola Willis similarly said: “In general, the Government is very reluctant to retrospectively legislate on these matters. So, our position would be about the arrangements going forward.”
So, while the new law might save Uber from changing its business model in the future, it won’t protect it from claims associated with the way it treated drivers in the past.
This might seem obvious, but the Government has on two recent occasions moved to apply new rules to the past.
Its new pay equity regime has cancelled active pay equity claims and it is rewriting the Credit Contracts and Consumer Finance Act (CCCFA) for between 2015 and 2019.
It initially proposed changing the CCCFA to help ASB and ANZ in the face of a very costly class action (which ASB has since settled).
However, the Government was criticised for the move, so has included a carve-out in the law to ensure the class action proceeds in accordance with the law under which it was brought forward.
National and Act also took a strident position on employment relations in their coalition agreement, saying they wanted to prevent those who signed up to contracting arrangements from being able to challenge their status in the Employment Court.
Speaking to the Herald, Hesketh Henry law firm partner Jim Roberts recognised the enormity of the task that lay ahead of Uber, if it was made to calculate how much a thousand-plus drivers would have been paid had they been employees rather than contractors.
He believed drivers would be able to make claims going back six years.
While Uber claims most drivers are happy with the status quo, Roberts doubted they made more money than if they were employees, particularly once all their leave entitlements were factored into the equation.
Buddle Findlay law firm partner Sherridan Cook said the Supreme Court judgment was a big deal for Uber, but didn’t believe it would empower scores of contractors in other sectors to fight for employee status.
He believed contractors would make claims if they were unhappy based on the specifics of their own circumstances, rather than the outcome of the Uber case.
As for the proposed new test for what constitutes being a contractor, Cook believed Uber would be able to ensure its operations met the test.
He noted that while the courts put a lot of weight on the control Uber had over drivers to support their view the drivers were employees, the proposed test puts more weight on contractors being able to work for competitors. Cook believed this emphasis would help Uber.
Indeed, Uber said it wouldn’t change the way it operated on the back of the Supreme Court ruling.
The Workers First Union was critical of the proposed new test, saying it stood in the way of the “real nature of the relationship” test.
While the union called for the test to be scrapped, Uber and BusinessNZ wanted the law clarified quickly to provide certainty for businesses and workers.
Contrary to Cook’s view, BusinessNZ said the court ruling had “far-reaching implications for the economy at large”.
Van Velden expected the new test to take effect next year once the Employment Relations Amendment Bill is passed.
Parliament’s Education and Workforce select committee has heard public submissions on the bill and is due to report back before Christmas on any potential changes it believes should be made.
Jenée Tibshraeny is the Herald’s Wellington business editor, based in the Parliamentary press gallery. She specialises in government and Reserve Bank policymaking, economics and banking.
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