Kerre Woodham: Contractors, employees, and the gig economy

Business NZ Chief Executive Katherine Rich says the Supreme Court's ruling that Uber drivers are in fact employees of Uber, not contractors, could have far-reaching implications for businesses that hired contractors, and she says it could collapse the gig economy. What's the gig economy? Well, when we're talking about the gig economy, we mean people who work on single projects or tasks, gigs, on demand. They're often hired through a digital marketplace, think Uber, Airbnb, and gig workers can be anyone from part-timers looking to make extra dosh from a second job that they can work around their own hours, to full-time freelancers. They can also be from a range of backgrounds across a range of industries.  

On the plus side, if you're a gig worker, there's more flexibility for hours and remote work, high earning potential —the keyword there is potential—, the option to work for various companies, you're not tied to one, and the ability to become your own boss. 

On the downside, there is the potential to make very little. The gig economy is unsteady, and for many it's an unsatisfactory alternative to a secure and stable full-time job with all the associated benefits, sick pay, annual leave, and the like. Now, a lot of young ones say they want the flexibility that comes with having a gig and a side hustle and doing a bit there. The idea of turning up and working 9am to 5pm is absolute anathema to them, until they get sick or until they realise that they need to set aside money for holidays or until say they want parental leave. And then all of a sudden, a secure job doesn't look so bad after all.  

Now, with the Supreme Court ruling, in effect, contractors can have their cake and eat it too if it flows on to other industries. The drivers who brought the case against Uber said they were seeking fundamental human rights in relation to the work they did for the company. 

Uber says, "Oh, come on, you knew what you were getting into when you signed the contract. Drivers are in control of business decisions in a manner not typical of an employee situation. They can decide whether, when, where, and for how long to drive, or whether they want to do other work instead." They also had the ability to and did make decisions around assets, business costs, and organize their own tax affairs. 

Uber accepted in court that drivers didn't have input into the structure. For example, when Uber decided to slash the fares in Auckland and Wellington, it was a bit of a promotion, drivers had no say over that. But they say the drivers know what the platform looks like, they accepted and they use it. They enter into a service agreement, and they act accordingly. 

Workplace Minister Brooke van Velden told Mike Hosking this morning that the Government's looking to make changes to define exactly what it means to be a contractor. She outlined it very, very clearly, and we will get that to you. Basically, she says that the law hasn't really kept up with the new economy. The workplace law hasn't kept up with the new economy. That, you know, the way Uber wasn't around 10 years ago. Airbnb wasn't around 10 years ago, and workplace law hasn't kept up with it. But can you really have your cake and eat it too? If you don't like turning up to the same employer 9am to 5pm, you know what your job is, you know what your hours are, the very regularity of it that makes a job like that so attractive to some people, Makes it a turn off to others. They don't want that regularity in their lives. They want to be free to work when they want to. 

It doesn't seem right that you have your cake and eat it too, does it? Brooke van Velden says she'll make changes. The Supreme Court says Uber has to treat its drivers like employees. Would love to hear from you on this one, especially if you've worked for Uber. I know a number of people have. I ran into an old film director of mine from Television New Zealand days who was driving an Uber. Really enjoyed it. Loved the in effect retired, but still really loved meeting people, kept them out of the house, enjoyed driving, really enjoyed it. All sorts of people have done a bit of Uber. 

Do you feel like an oppressed member of the working classes with the corporate boot on your neck? Did you know what you were getting into when you signed up? And what implication does this have for employers who do use contractors? 

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Episode Transcript

Speaker 1 (00:06):
You're listening to the Carrywood and Mornings podcast from News
Talk SEDB Business.

Speaker 2 (00:12):
And Z Chief executive Catherine Rich says the Supreme Court's
ruling that Uber drivers are in fact employees of Uber,
not contractors, could have far reaching implications for businesses that
hired contractors, and she says it could collapse the gig economy.
What's the gig economy. Well, when we're talking about the

(00:33):
gig economy, we mean people who work on single projects
or tasks gigs on demand. They're often hired through a
digital marketplace think Uber, Airbnb, and gig workers can be
anyone from part time is looking to make extra dosh
from a second job that they can work around their

(00:54):
own hours, to full time freelancers. They can also be
from a range of backgrounds across a range of industries.
On the plus side, if you're a gig worker, there's
more flexibility for hours and remote work, high and potential
and the keyword there is potential, the option to work

(01:14):
for various companies you're not tied to one, and the
ability to become your own boss. On the downside, there
is the potential to make very little. The gig economy
is unsteady, and for many it's an unsatisfactory alternative to
a secure and stable, full time job with all the

(01:35):
associated benefits sick pay and you'll leave and the like.
Now a lot of young ones say they want the
flexibility that comes with having a gig in a side
hustle and doing a bit here and doing a bit there.
The idea of turning up and working nine to five
as absolute anathema to them until they get sick, or
until they realize that they need to set aside money

(01:56):
for holidays, or until say they want parental leave, and
then all of a sudden, a secure job doesn't look
so bad after all. Now, with the Supreme Court ruling
an effect, contractors can have their cake and eat it

(02:19):
too if it flows on to other industries. The drivers
who brought the case against Uber said they were seeking
fundamental human rights in relation to the work they did
for the company. Uber says, well, come on, you knew
what you were getting into when you signed the contract.
Drivers are in control of business decisions and a manner
not typical of an employee situation. They can decide whether, when,

(02:45):
where and for how long to drive, or whether they
want to do other work. Instead. They also had the
ability to and did make decisions around assets, business costs
and organize their own tax affairs. Uber accepted in court
that drivers didn't have input into the structure. For example,

(03:07):
when Uber decided to slash the fairs in Auckland and
Wellington is a bit of a promotion. Drivers had no
say over that. But they say, the drivers know what
the platform looks like, they accepted and they use it.
They enter into a service agreement and they act accordingly.
Workplace Minister Brook van Valden told Mike Hosklin this morning
that the government's looking to make changes to define exactly

(03:31):
what it means to be a contractor. We don't have
the audio, but that's okay. She outlined it very very
clearly and we will get that to you. But she's
looking to Basically, she says that the law hasn't really
kept up with the new economy. The workplace law hasn't
kept up with the new economy. That you know, the

(03:55):
way Uber wasn't around ten years ago, Airbnb wasn't around
ten years ago, and workplace law hasn't kept up with it.
But can you really have your caken it too? Like
you if you don't like turning up to the same
employer nine to five. You know what your job is,
you know what your ours are. The very regularity of

(04:19):
it that makes a job like that so attractive to
some people makes it a turn off to others. They
don't want that regularity in their lives. They want to
be free to work when they want to. It doesn't
seem right that you have you ca can eat it too,
does it? Brook van Velden says she'll make changes. The

(04:45):
Supreme Court says Uber has to treat its drivers like employees.
Would love to hear from you on this one, especially
if you've worked for Uber. I know a number of
people have. I ran into an old film director of
mine from television New Zealand Days who was driving Uber.
Really enjoyed it, love the an effect, retired but still
really loved meeting people, kept mind the house, enjoyed driving,

(05:09):
really enjoyed it. All sorts of people have done a
bit of Uber. Do you feel like an oppressed member
of the working classes with the corporate boot on your neck?
Did you know what you were getting into when you
signed up? And what implication does this have for employers
who do use contractors.

Speaker 1 (05:30):
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