Uber granted right to appeal drivers' employment status

Friday, 9 June 2023

Uber has been granted the right to appeal a landmark Employment Court ruling in October that four of its drivers should have been treated as employees, rather than as independent contractors.

The Employment Court ruling has been regarded as an important test case that could potentially open the door to tens of thousands of “gig economy” workers, such as courier drivers and subcontractors in the construction industry, claiming employment status.

That could allow those workers to lodge claims for backdated holiday pay and meal breaks, as in the case of the four Uber drivers, as well as to employment protections such as the right to file personal grievance claims and an entitlement to the minimum wage.

The Court of Appeal on Thursday granted Uber the right to the appeal the Employment Court ruling, which Judge Jillian Mallon said raised questions of law about fast-moving changes to the way work is done.

She also noted in her ruling that the issues in question could have an impact on other businesses.

The First Union described the decision by the Court of Appeal as not unexpected, and forecast it would allow unions “to cement the original Employment Court ruling”.

Union president Robert Reid said drivers were confident of winning the coming court case despite what it described as “Uber's attempts to delay the impact of the Employment Court's original verdict”.

“Rather than accepting the ruling, which is consistent with similar court verdicts in France and the UK, Uber is trying to appeal,” he said.

The Government has been considering amending the law to make the distinction between employees and contractors clearer.

A working group established by the Government recommended in 2021 that the “critical question” when determining whether a worker was an employee or a contractor was whether they were “genuinely in business on his or her own account”.

The Employment Court appeared to apply essentially that test in its October ruling, converging on what appeared to be the likely new legislative position.

However, in March, the Government appeared in turn to defer back to the courts by placing its planned law reform on hold pending the outcome of the expected Uber appeal of the Employment Court decision.

That has left unresolved the question of whether the Government or the courts may ultimately define the employment boundary.

Uber New Zealand general manager Emma Foley appeared to suggest an alternative approach that would see “gig economy” workers remain as contractors but receive better protections under the law.

“While we are pleased to have been granted leave to appeal and make our case to the appellate court, it’s our view that industry-wide standards and better protections for Kiwi gig workers should be enacted through legislation,” she said in a statement on Thursday.

“Governments around the world have embraced the changing nature of work and have begun passing fit-for-purpose laws that better protect gig workers and flexible working arrangements. There’s no reason New Zealand can’t join them.”

A date for Uber’s appeal has yet to be set.