New Zealand Law Society - Consultation opens on contractors' rights

Consultation opens on contractors' rights

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The Government  has released a discussion document, Better protections for contractors, to begin consultation on options to improve rights and protections for vulnerable contractors.

Public consultation is now open, and closes at 5pm on 14 February 2020. The Ministry of Business, Innovation and Employment (MBIE) is co-ordinating the project.

The options which are presented have the objective of ensuring all employees receive their statutory minimum rights and entitlements, reducing the imbalance of bargaining power between firms and vulnerable contractors and ensuring system settings encourage inclusive economic growth and competition.

The document says independent contractors have fewer rights and protections than employees, and as a result can experience poor outcomes. It says there are growing concerns about workers in the following situations:

  • Workers who are, in substance, employees, but who are misclassified as 'independent contractors' by firms to reduce their entitlements.
  • Workers who are in the 'grey zone' between employee and contractor status.

"Workers in both of the situations ... are in a vulnerable position, lacking both the protections offered to employees by law, as well as the power to negotiate a better deal. The changing nature of work, including the expansion of the ‘gig’ economy, means that these issues may impact a growing number of workers in New Zealand," the document says.

It says the Government wants to ensure all workers in New Zealand have access to decent work with minimum standards and conditions.

A number of options for change have been identified, and these are grouped into four main approaches:

  • Deter misclassification of employees as contractors.
  • Make it easier for workers to access a determination of their employment status.
  • Change who is an employee under New Zealand law.
  • Enhance protection for contractors without making them employees.
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