CTU boss backs contract clause

By BRIAN FALLOW

WELLINGTON - Council of Trade Unions president Ross Wilson agreed in principle yesterday to adding a clause to the Employment Relations Bill to ensure people who are happy to be independent contractors are not classified as employees.

In select committee hearings on the bill, Act leader Richard Prebble asked Mr Wilson: "Providing it is not an unconscionable agreement, say one that resulted in slave wages ... is there any reason we should not put in a clause to make sure people who want to be self-employed can be?"

Mr Wilson said: "I think in principle that is the case. The issue for us is that those who do want the benefit of the protection [of being an employee], and are entitled to it, do get it.

"My only concern is about the reality of the choice. What has given rise to the issue is legal documents that purport to be a voluntary agreement between an employer and a so-called self-employed person ... where in reality that is being imposed unilaterally by the employer."

Mr Prebble said: "If you think that it is unfair that we should make people employees when they don't want to be ... then we might be able to make considerable progress."

As the bill stands, in deciding whether A is an employee of B, a primary consideration is the extent to which A is subject to B's control and integrated into B's business. The bill instructs the court to give less weight to whether the agreement describes A as a contractor. That is designed to address the problem of "bogus" self-employment, a situation the CTU says has become increasingly prevalent.

CTU lawyer Laura Cronin said the bill did not give a definition of dependent contractors, but provided tests for the courts to consider in determining the reality of the relationship.

The closing date for submissions is May 3.