Contractor work in Aotearoa New Zealand

Businesses with uncertain or changing demand for their products or services can benefit from offering flexible, short-term contracts. People may choose to accept work as a contractor to suit their individual lifestyle and preferences. Contracts for services are an important way for businesses to access specialist skills which they would not be able to retain in-house.

But some contracting arrangements are also associated with negative outcomes for the workers concerned. Contractors have none of the employment law protections that are designed to balance what the Employment Relations Act describes as the “the inherent inequality of power in employment relationships.”   

Work to date

The Government has been considering how to provide better protections for contractors. In summary:

• MBIE issued a discussion document in 2019 which set out a wide range of potential options for change.
• In 2021, the Government asked a Tripartite Working Group, made up of union, employer and public sector representatives, to examine the issue and report back with recommendations.
• The Tripartite Working Group provided its report in December 2021. Its recommended priority for reform was establishing a stronger distinction between employment and self-employment status in law. It recommended that policy work be undertaken to support consultation on a more detailed proposal.

The Tripartite Working Group recommended that a more detailed policy proposal based on its recommendations be developed and consulted on.

Since the Working Group delivered its report, the Employment Court delivered a judgment on the employment status of 4 Uber drivers. The decision has been appealed and this legal process will take some time to work through. 

The Employment Court ruling has significant implications on the legal definition of a contractor and the Government has announced that further work on responding to the Tripartite Working Group’s recommendations has been put on hold pending the outcome of the appeals process.

You can read previous work at:

Better protections for vulnerable contractors