Law change may need to be re-worded to do the trick for Uber

Tuesday, 22 July 2025

It is just the definition of contractors in the new legislation that seems to be creating a headache.

A law change that is intended to help gig economy companies carry on operating the way they do may need to be reworded, if it is to allow Uber to treat drivers as contractors rather than employees, it is understood.

The Employment Relations Amendment Bill, which passed its first reading in Parliament last week and has now been referred to a select committee, was drafted in the wake of doubts over the current legal status of Uber drivers and other gig economy workers.

The Supreme Court is currently deliberating whether to uphold earlier court rulings that a group of four Uber drivers were in fact employees of the firm, entitled to rights such as the minimum wage and holiday and sick pay, in a case that could set a major precedent in the ride-hailing and other industries.

The law change introduced to Parliament by Workplace Relations Minister Brooke van Velden is designed to give gig economy companies certainty that they won’t be on the hook for such costs in future by confirming people as a “contractors” if that is what they had agreed in writing, and so long as the business met set conditions.

These are that the business didn’t prevent those people working elsewhere, didn’t require they be available at specific times or for a minimum number of hours or — if they did — allowed them to subcontract their work, and didn’t terminate their contract if they turned down a “gig”.

However, the way such “specified contractors” have been defined in the legislation might preclude Uber from being able to make use of the law change.

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That is because a specified contractor has been defined as a person who has “entered into an arrangement to perform work” for the business, and no such arrangements are in place between Uber and Uber drivers — at least in Uber’s view.

Uber has not made public comment, but a spokesperson for van Velden confirmed she was aware of the issue.

It is not protocol for a minister to comment on legislation while it is front of a select committee, but her spokesperson noted that parties that had concerns could make submissions to the committee.

The wording issue hasn’t stopped other ride-hailing businesses from expanding their operations in New Zealand.

Estonian-based Bolt began providing a rival service in Auckland last month and Chinese firm Didi will expand from Auckland into the Wellington market on July 21.

Didi spokesperson Dan Jordan said the intent of the legislation appeared clear.

It is understood to be assuming any issues with its wording will be ironed out during the select committee process.

Objecting to the law change during its first reading, Labour workplace relations spokesperson Jan Tinetti accused the Government of being “absolutely hell bent on putting the rights of the workers right to the bottom of the pile”.

Van Velden said “flexible labour markets” were the best environment for businesses to grow, lift wages, create opportunities and help Kiwis get ahead.