Workplace Advice Archives

Uber drivers are employees – for now

February 2, 2026

Employment Law, Gig Economy, Supreme Court Decisions, Workplace Advice, Workplace Rights

The Supreme Court’s decision is final, but proposed legislation may off an alternative

Uber has an unusual but highly successful business model. It has proved difficult to classify its drivers under employment law, both in New Zealand and in other countries where it operates.

Employees vs independent contractors

The issue is whether Uber’s drivers are employees or independent contractors. The legal status of Uber drivers has significant consequences.

Employees have a range of statutory entitlements, including annual leave, sick leave, bereavement leave, employer contributions to KiwiSaver, minimum wage levels, and the right to join a union and engage in collective bargaining with their employer.

Independent contractors have none of these rights. However, they are entitled to offset their expenses against their income for tax purposes. Employees cannot do this.

The New Zealand court system has been grappling with this issue for the last five years. In 2021, the Etū union filed proceedings in the Employment Court seeking a declaration that four Uber drivers were employees. The Employment Court ruled in the union’s favour, declaring that the drivers were employees. Uber appealed to the Court of Appeal. The Court of Appeal declined the appeal. Uber sought, and was granted, permission to appeal to the Supreme Court. The Supreme Court released its decision on 17 November 2025. ^[1]

Supreme Court decision

The Supreme Court upheld the Employment Court’s decision that Uber drivers are employees, The court applied the well-established test for determining whether workers are employees set down in the Bryson case.^[2]Bryson considered the issue of whether crew members on the ‘Lord of the Rings’ film project were employees or independent contractors. The test derived from this case involves considering the intention of the parties (how they describe their arrangement), the degree of control the company has over the worker, the extent to which the worker is integrated into the company’s business and whether the worker can realistically be said to have their own business.

Uber’s contractual documentation avoids the terms employee and independent contractor altogether. Uber claimed that it merely provided a service to drivers and riders by matching them through its app. The Supreme Court found that this documentation did not reflect the true position and that, in reality Uber was using its drivers to provide transport services to its customers.

The court found that Uber exerts a high degree of control over its drivers, which suggests they are employees. Uber monitors the location of its drivers while they are using the app. Uber operates a reward system for drivers that strongly encourages them to accept nearly all the trips offered to them. Once a driver accepts a trip, Uber specifies the route they must take and the price for the trip.

The court accepted that drivers are not integrated into Uber’s business in the traditional sense. They do not wear uniforms or have Uber branding on their vehicles. The court found, however that the drivers are integrated into Uber’s business in the sense that they are the ‘face’ of Uber’s business. The drivers are the only individuals that customers have contact with when buying services from Uber.

The court also held that drivers do not, in reality, operate their own businesses. They have no opportunity to generate goodwill through a loyal customer base. They are not provided with customers contact details. They are prohibited from providing services to customers outside the Uber framework. In addition, customers are unable to select a specific driver. The app allocates a driver to them.

The Supreme Court is New Zealand’s highest court; therefore the court’s decision is the final say of the New Zealand courts on this issue. However, there is currently draft legislation before Parliament that, if enacted, will change the law relating to this issue.

The proposed ‘gateway test’

The Employment Relations Amendment Bill includes a proposed ‘gateway test.’

The Bill lists five criteria for the gateway test. If a worker’s contract meets all five criteria, then they will be deemed to be an independent contractor, and they will be unable to take legal action to be treated as an employee.

However, if the contract does not meet all five prerequisites, then their status may be decided by the courts using the tests applied in the Uber case.

The five elements of the proposed gateway test are currently:

The contract defines the worker as an ‘independent contractor’
The worker may work for other parties (except while working for the other party to the contract)
The worker is not required to work set hours, or may subcontract their work to others
The contract does not end if the worker refuses additional work, and
The worker had the opportunity to take independent legal advice before signing the contract.

The Bill passed the select committee stage at the end of last year and has returned to Parliament for its second reading.

It is unknown when the Bill will become law, as this will depend on how the government chooses to prioritise the legislation currently before Parliament. However, when the Bill is passed, it will enable companies to be certain that their workers are independent contractors, provided their agreements with their workers meet the requirements of the gateway test.

In the meantime, however the test for whether someone is an employee or a contractor is well established. If you need some help with sorting out your current work situation, please don’t hesitate to contact us.

^[1] Rasier Operations BV & Ors v Etū Inc & Anor [2025] NZSC 162.

^[2 ^] Bryson v Three Foot Six Ltd [2005] NZSC 34.

DISCLAIMER: All the information published in Commercial eSpeaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Commercial eSpeaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2026 Editor: Adrienne Olsen. E-mail: [email protected] Ph: 029 286 3650

Employment law reform in 2025

July 28, 2025

Business Updates, Contracts and Agreements, Employment Law, Health & Safety, Legal News, Workplace Advice

Employment law continues to evolve, with several changes, or proposed changes, introduced by the government in recent months. The changes are widespread across the employment law spectrum, and it will be important for both employers and employees to be across them.

Theft by an employer

The Crimes (Theft by an Employer) Amendment Bill came into effect on 13 March 2025. Amending the Crimes Act 1961, it now states an employer will commit theft if they intentionally fail, without reasonable excuse, to pay money owed to an employee under their employment agreement and/or statutory obligations. This includes all remuneration entitlements during the notice period and any outstanding holiday pay when they leave their employment.

Whilst this does not change employer obligations, it increases their potential vulnerability to criminal prosecution if money is withheld.

If employers are found guilty of theft under this new law, they can be liable:

For individual employers, for a fine of $5,000, up to one year’s imprisonment, or both, or
For corporate employers, a maximum fine of $30,000.

Equal Pay Amendment Act

On 14 May 2025, the government amended, under urgency, the Equal Pay Act 1972; this was originally implemented to promote gender pay equity by ensuring that employees received equal pay for work of equal or comparable value.

These amendments increased the threshold for what is required to raise a claim under the Act and discontinue current pay equity claims.

Pay deductions for partial strikes

On 25 June 2025, the Employment Relations (Pay Deductions for Partial Strikes) Amendment Bill was passed.

Partial strikes are a common bargaining tool used by employees in negotiations with their employer; employees report to work but reduce their usual outputs or breach their employment agreement in some way. This legislation has reintroduced the ability to make pay deductions from an employee who is involved in a partial strike.

The specified pay deduction can be calculated by either:

Calculating the percentage of reduction in work rate resulting from the strike, or
Applying a 10% deduction.

The deduction will only apply to the time period an employee took part in a partial strike (notice to an employee would be required before the deduction is made). An employee’s remuneration for that period will not be subject to statutory minimum wage requirements.

There is an exception to this where an employee has reasonable grounds for believing the strike is justified on the grounds of health and safety under s84 of the Employment Relations Act 2000.

Termination of employment by agreement proposal

The Employment Relations Act 2000 (ERA) currently states that an employee can only be dismissed if there is a good reason to do so (justification), and a fair and proper process is followed.

The Employment Relations (Termination of Employment by Agreement) Amendment Bill would allow an offer to be made to an employee to mutually terminate their employment by paying a specified sum to them by way of settlement. This change would allow greater freedom for parties to negotiate exits without the risk of a personal grievance claim arising from the termination offer.

Employee remuneration disclosure

The ERA currently allows employers to include provisions that prevent their employees from disclosing, or discussing, their remuneration with colleagues or third parties. Under this proposed legislation employees would not be required to keep their remuneration details confidential.

The Employment Relations (Employee Remuneration Disclosure) Amendment Bill sets out that employees will have grounds for a personal grievance under s103 of the ERA, if an employer has engaged in adverse conduct for a remuneration disclosure reason. The intent behind the Bill is to increase pay transparency, and with the hope of addressing pay inequities.

Unjustified dismissal regime

The government announced on 17 June 2025 the introduction of the Employment Relations Amendment Bill. The bill proposes that employees who earn $180,000 per annum or more (in base pay) will be prevented from raising a personal grievance for unjustified dismissal. This threshold aligns with the top tax bracket and is said to affect about 3.4% of the current workforce. The threshold would subsequently be adjusted annually to reflect the CPI.

Under this proposed legislation, an employee earning above the specified income threshold could be dismissed without the risk of an unjustified dismissal claim – unless their employment agreement explicitly preserves this right. This change will apply to all new employees and, after a 12-month transition period, to all employees.

If this bill is passed, we expect more senior employees to negotiate compensation provisions in their employment agreements in the event of termination.

Personal grievance remedies reduction

The ERA currently requires an employee’s conduct to be considered when the authority or court awards remedies for successful personal grievances (PG). However, the Employment Relations Amendment Bill introduced on 17 June, gives greater weight to an employee’s behaviour by:

Removing an employee’s eligibility for remedies for a PG if their behaviour amounts to serious misconduct
Removing an employee’s ability to apply for reinstatement or compensation (other than lost wages) if their behaviour contributed to the issue giving rise to the PG
Allowing courts and tribunals to reduce awards entirely
As part of the potential awarding of remedies, considering whether an employee delayed the disciplinary process, and
Removing employer penalties for minor flaws in the disciplinary process if all other conduct was fair and reasonable.

Review of health and safety

In 2024 the government undertook a consultation aimed at understanding how the current health and safety legislation works. In response, the following changes have been proposed:

An exemption for small, ‘low risk’ businesses from some general Health and Safety at Work Act 2015 (HSWA) requirements. These businesses will only have to manage critical risks and provide basic facilities to ensure worker welfare
Landowners will not be responsible if someone is injured on their land while doing recreational activities. These responsibilities will lie with the organisation that is running the activity
Addressing overlapping health and safety duties by clarifying boundaries between the HSWA and regulatory systems that manage the same risk
Amending the notification requirements, so that only significant workplace events are reported, and
Clarifying the distinction between governance and management’s role in managing health and safety risks, ie: the board leaving the day-to-day management of risks to management.

Additional proposed changes to note

The Employment Relations (Restraint of Trade) Amendment Bill is awaiting its second reading. This bill seeks to limit circumstances where restraint of trade provisions can be enforced by having an income threshold, requiring compensation for the period of the restraint and ensuring they are reasonable.

The Employment Relations Amendment Bill introduced on 17 June 2025, included the long awaited ‘gateway test’ to be used when determining whether a worker is a contractor. For clarification on this proposed test, please get in contact with us.

Wide impact

There will be few employers and employees who are not impacted by the proposed changes; these will require employment agreements to be reviewed, change the way employment relationships are terminated and result in a different focus in personal grievance disputes.

We are happy to advise on how to work your way through the impacts of both the proposed changes and the recently passed legislation.

DISCLAIMER: All the information published in Property Speaking is true and accurate to the best of the authors’ knowledge. It should not be a substitute for legal advice. No liability is assumed by the authors or publisher for losses suffered by any person or organisation relying directly or indirectly on this newsletter. Views expressed are those of individual authors, and do not necessarily reflect the view of Edmonds Judd. Articles appearing in Property Speaking may be reproduced with prior approval from the editor and credit given to the source.
Copyright, NZ LAW Limited, 2022. Editor: Adrienne Olsen. E-mail: [email protected]. Ph: 029 286 3650

Workplace Advice