GUEST BLOG: Ian Powell – The Uber Labor Court Ruling and What May Come Next
Labor Court Judge Christina Inglis in a landmark ruling ruled that four Uber drivers were employees and not independent contractors, opening the door for many other drivers to seek labor law protections. This follows a successful case taken by two unions – First Union and E tū.
The case is well covered by Rebecca Macfie in her October 26 Writing article: Opening flood gates for Uber drivers. In my opinion, Macfie is New Zealand’s most highly regarded and insightful journalist on trade unions, trade unionism (there is a difference) and labor relations.
Outstanding Labor Journalist Rebecca Macfie
What is landmark in the Court’s decision?
The implications and benefits of this decision, such as the right to collective bargaining, salary arrears, annual leave and sick leave and several other better working conditions, are considerable. But they go beyond Uber drivers to other so-called contractors in similar circumstances.
These similar circumstances center on what is often described as the “test of control.” In other words, the labor court found that, such was the degree of control that Uber exercised over its drivers, to label them as independent contractors constituted a “misclassification”. Instead, they were employees denied basic job protection rights because of this “misclassification”.
The Court recognized the extensive efforts made by Uber and other platforms to claim that their drivers were not employees and therefore not entitled to employment rights and protections. Uber was not, as it claimed, a mere market facilitator. There was a sufficient level of subordination and dependency to dismiss Uber’s defense.
Macfie noted that the Court’s decision was consistent with previous case law, including the lead case in which the Supreme Court found James Bryson, a former model maker on The Lord of the Rings films, to be an employee and not an entrepreneur. Film producer Peter Jackson was furious with the decision.
Additionally, the Uber ruling follows “…a succession of international cases that have sought to curb Uber’s use of drivers as contractors to circumvent labor laws.” This includes the UK, France, the Netherlands and Switzerland, where courts have found Uber drivers to be employees.
The flood the door has opened is the opportunity it offers Uber drivers in similar “subordinate and dependent” circumstances to join and be collectively and individually represented by a union. The flood gate also potentially extends to other industries where the same circumstances exist.
But: a warning from Bryce
Drawing on Macfie’s excellent article and other commentaries, academic and political commentator Bryce Edwards has published his own analysis in the Democracy Project (October 26): Uber court rules major victory against worker exploitation.
It’s insightful writing that’s pretty much on the mark (almost). In particular, Edwards observes that:
… Labor had sought to solve the problem of vulnerable workers being legally classified as contractors by creating a new hybrid legal category of ‘contractor-worker’. These employees would not have all the rights of workers, but would have better conditions than contractors. It was a compromise solution, which is actually lower than what the Labor Court ruled yesterday. Therefore, the government and Wood can be said to be pushing for something less progressive than the courts.
Uber and other employers are likely to pressure the government to pursue this “solution”, which could save them from having to offer full employee status to all their workers. And yesterday the following was reported: “Uber says it supports reform and believes the only way workers and platforms can have certainty is if change is brought about through the parliamentary process rather than the court. work.”
Political commentator Bryce Edwards is close but hasn’t quite hit the mark
It’s hard to argue with this analysis, except that elsewhere in his article he refers to Labor Relations Minister Michael Wood as wanting to create a lower category of “contractor-workers”. It’s wrong. He has the wrong guy.
Hobbits and carve-outs
The Bryson-‘Lord of the Rings’ case mentioned above is the trigger point. Peter Jackson was desperate to maintain the level of control he thought he had over his film production staff until the Supreme Court ruled otherwise.
It was the driving force behind Jackson’s aggressive and hard-line approach taken in the famous later Hobbit conflict in which he influenced the national government of the day to pass special legislation to ensure that Jackson’s workforce were legally subordinate and dependent contractors. A fine example of the difference between law and justice!
In opposition, Labor promised to repeal the Hobbit Law. But in government, they and the Council of Trade Unions led by its chairman Richard Wagstaff were effectively lured (maneuvered) into the film industry and the Department of Innovation and Jobs.
They agreed, through the Screen Industry Workers Bill, to exempt the film industry from the protection of employees under the Labor Relations Act, reinforced by the court decisions of the work. I talked about it in detail in an article published by the Democracy Project July 30, 2020: Movie industry bosses get what they want with reformed Hobbits Act.
It is essentially a compromise between the collective representation of contractors and the loss of the right to full protection for employees. The film industry is excluded from the greater protections of labor relations law. The bill was passed only recently and the new law comes into force at the end of the year.
Much of the reason for the delay was Michael Wood’s behind-the-scenes efforts not to go any further due to the broader implications, including precedents, of shielding some of the workforce from protections and labor relations rights. Law. Unfortunately, Wagstaff had more influence on the Cabinet than he did. Wood was an heir rather than an initiator of the bill.
If the hobbit law had simply been repealed, given the decisions made on contractor status versus employee status by the labor court (especially now reinforced by the Uber decision), workers in the industry of the screen would be in a stronger legal position than under the new law.
Ironically, MBIE, Business NZ and the CTU have produced an interesting quality paper proposing to capture in legislation the underlying premise of industrial tribunal decisions on contractor versus employee status.
Uber’s next steps
Uber is certain to appeal the court’s decision, although its prospects seem unlikely. However, Bryce Edwards’ article highlights the measures planned by Uber to prevent the success of the First and E tū unions by engaging in what would amount to another exclusionary initiative.
Richard Wagstaff: CTU’s “Enduring” President
Although Richard Wagstaff welcomed the Court’s Uber decision for all the right reasons, there are concerns that he will be drawn into this approach as he has been with workers in the screen industry. After all, if it’s good enough for them, it’s surely good enough for the gig workers!!!
The biggest protector against this success is that the two unions that took the case to court are street sages and battlers. Nor would Uber force them to accept a result less favorable than what they got in court after a hard fight.
Unions will need to ensure that CTU senior management is not pressured into engaging in activities that end up taking on a life of their own and following a path of exclusion. They are strong enough to prevent this.
If there is a gig/Uber carve-out, which part of the workforce is next. Salaried medical specialists? The first and arguably biggest fight I had when I represented the Association of Salaried Specialist Physicians was against concerted attempts in the early to mid-1990s to deny them access to collective bargaining (in the context of individual contracts).
All it takes is the right ideological stars and the right levers to line up for this kind of thing to happen.
Ian Powell was executive director of the Association of Salaried Medical Specialists, the professional union representing senior doctors and dentists in New Zealand, for over 30 years until December 2019. He is now a health systems commentator , labor market and political living in the small river estuary community of Otaihanga (the place by the tide). First published on Political Bytes
