New Zealand Uber drivers win case, recognized as employees • TechCrunch
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A group of Uber drivers in New Zealand won a landmark case on Tuesday against the ride-hailing company, which forced Uber to treat them as employees rather than independent contractors.
The New Zealand Employment Tribunal decision only applies to the four drivers who were part of a class action lawsuit filed last Julybut the ruling could have broader implications for drivers across the country interested in workers’ rights and protections.
The move to New Zealand happened just a couple of weeks later The US Department of Labor suggested widespread changes in the classification of concert staff. Specifically, the proposed ordinance seeks to classify gig workers as employees if they are economically dependent on the company they work for.
A formal decision in New Zealand has been made against the individual drivers in the case. According to Chief Labor Court Judge Christina Inglis, the court does not have jurisdiction to make broader employment status claims for all Uber drivers. This means that all other Uber drivers do not immediately become employees; however, Inglis said the decision “could have a wider impact” because of the “apparent homogeneity in how companies operate and the framework within which drivers work”.
In Art rulingThe Employment Tribunal said that while an employee’s contract may define him as an independent contractor, that definition depends more on the “substance of the relationship and how it operated in practice”.
“The court recognized that some of the usual signs of a traditional labor relationship are absent,” the ruling reads. “However, significant control over drivers was found to be exerted in other ways, including through incentive schemes that reward consistency and quality and withdraw rewards for violating the Uber Guidelines or for quality lapses as measured by user ratings.”
The court ruled that Uber, in its sole discretion, can control pricing, service requirements, instructions, terms, marketing, passenger relations and more.
“Uber was able to exercise significant control because of the subordinate position in which each of the plaintiff drivers was placed and for which its operating model was designed and facilitated,” the ruling said.
Last year, two unions, First Union and E tū, took up the case on behalf of more than 20 drivers. Their aim was to overturn a legal precedent set by the Employment Tribunal in 2020 which found that a driver was not an employee. Labor rights activists have argued there, as in the US and elsewhere, that because Uber drivers’ rates are set by Uber, the company controls wages, which puts it in the employer’s territory. At the time, the judge ruled that the driver effectively controlled their wages because they could be paid less or increase the profitability of their business through lower business costs.
The ruling, passed on Tuesday, will give drivers sick leave, holiday pay, minimum wages, guaranteed working hours, KiwiSaver contributions, the right to challenge unfair dismissal and the right to unionize under New Zealand labor laws.
First Union is now accepting Uber drivers as members at a discounted rate of $3.05 per week and will initiate collective bargaining. Union says Uber drivers may be required to pay back lost wages, vacation pay and other benefits.
“This is an important legal decision not only for Aotearoa, but internationally,” said Anita Rosentreter, First Union’s strategic project coordinator.
Uber did not immediately respond to TechCrunch’s request for comment, but a company spokesperson said Guardian that the company would appeal the decision and that it was “too early to judge” how the court’s decision would affect the company’s New Zealand operations more broadly.
The New Zealand decision is the latest in a series of international cases where workers have fought for their rights to work at companies involved in the economy. Last December The UK High Court has dealt a massive blow to Uber outlawing the business and classifying gig workers as “workers,” a new classification that provides the flexibility of independent contract work and the rights of salaried employee status.
Last year, Mr analysis from the International Lawyers Assisting Workers Network, a membership organization of trade unions and labor rights lawyers, revealed that major companies such as Uber and Deliveroo have faced at least 40 major legal challenges in 20 countries, including Australia, Brazil, Canada, Chile, South Korea and throughout Europe.
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