Courier contractor employment case a 'human rights issue', lawyers say

A courier driver has won what his lawyers say could be an important victory in the Employment Court after the court ruled he was an employee, rather than a contractor.

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Lawyers Michelle and Barry Pollack say the ruling has important implications for the industry. Source: Breakfast

Parcel Express argued that Mike Leota was an independent contractor, not an employee, which meant he was not able to access a range of statutory rights for employees, including minimum wages, holiday and sick leave, Kiwisaver and parental leave.

However, Chief Judge Christina Inglis yesterday released her judgment in Mr Leota's favour, saying she was satisfied that, in reality, Mr Leota was in an employment relationship with the company.

Before starting with Parcel Express, Mr Leota was told he would need to buy a van and have it signwritten with Parcel Express livery at his own expense, and his contracted banned him from working for any competitors fox six months after termination, and within 100km of the Auckland CBD.

Judge Inglis said in her ruling that Mr Leota "worked exclusively for Parcel Express to enable it to meet its business needs and was guaranteed a minimum sum for doing so.

"The facts reveal that he never rose over that minimum sum despite the hours he worked, the effort he put in, and the expense to which he went to meet Parcel Express’s business requirements.

"Mr Leota did not own a courier van before being told by Mr Cole that if he wanted to work with Parcel Express he would need to buy one; that it would need to meet the company’s specifications as to colour, size and type; that it would need to have signwriting in the company’s name; and that he would need to pay for its running costs and insurance.

"The signwriting was arranged by Parcel Express and it was Parcel Express that invoiced Mr Leota for the costs associated with it.

"The totality of the evidence strongly suggests that Mr Leota had no business of his own; he was solely in the business of Parcel Express."

Judge Inglis noted in the ruling that while Mr Leota had been deemed to be employed, rather than a contractor, the same may not be true for all couriers working around New Zealand.

However, Mr Leota's solicitors Michelle and Barry Pollak this morning told TVNZ 1's Breakfast that they do see it as a potentially important precedent which could influence future cases.

"It's been a long time coming - the state of courier drivers has been up in the air for many years," Mr Pollak said.

"The Chief Judge does say that the case applies to Mr Leota only, but in reality it does apply to courier drivers.

"The Freightways group of companies, who are the largest employers of courier driver in New Zealand, made a point of attaching themselves to the proceedings to give their submissions."

Ms Pollak described courier drivers as "vulnerable workers" who were forced to take "all of the financial risk, but their employer is the one that's got all of the control over that particular working relationship.

"So there is a very big imbalance of power because you've got one person that's footing the bill but that's not the person who gets the opportunity to have a say on how they actually operate on a day-to-day basis," Ms Pollak said.

"They're told what kind of tools that they're required to have, they're told exactly what the price of those tools are and they're just expected to do everything that they're told."

Ms Pollak said that after going through Mr Leota's work details, they concluded that he was likely earning less than the minimum wage, and said it was also likely that other courier drivers across New Zealand are in the same situation.

Mr Pollak said that simply because an industry considers its workers to be contractors, that doesn't make it true.

"Simply because somebody is labelled a contractor, doesn't mean that they are a person genuinely in business on their own account," he said.

"A courier driver does not conduct a business - they might own a van, but that's not conducting a business.

"It is also a fundamental human rights issue - as a contractor they can't join a union, they can't engage in collective negotiations, and as an employee you can do that."