• GGB is a company that provides residential garden waste services. In particular, GGB organizes garden bins to be picked up from residential addresses.
• In 2019 Caitlin was a driver at another company when Eric Gilmore, the director of GGB, approached her and discussed the prospect of engaging her as a driver with GGB. Caitlin had only previously been engaged as an employee.
• Caitlin is a little hazy about the content of these initial discussions with Mr. Gilmore. She recalls that Mr. Gilmore told her that she would be a contractor. Mr. Gilmore said that being a contractor was not significantly different from being an employee. As another driver was coming on board as a contractor, it would be easier if Caitlin was an independent contractor too. Mr. Gilmore apparently told her she could find information about the tax implications of being a contractor on the IRD’s website.
• Mr. Gilmore also provided Caitlin with a document titled “Agreement Between Owner and Contractor” dated 31 March 2019. Caitlin signed it. The relevant parts of the Agreement are set out in your handout.
• Caitlin says that she commenced work for GGB immediately and without any training. Her daily work involved picking up one of GGB’s trucks from their premises. Her workload was then advised at 8 am each morning at a daily staff briefing. During the day, instructions about her workload were updated (if necessary) by direct instructions by Mr. Gilmore or another member of GGB’s staff. Within the parameters of her daily workload, Caitlin could structure her day how she wished. She would often visit her grandmother for morning tea after emptying her first load of bins and refueling. At the end of a working day, GGB required Caitlin to complete paperwork back at GGB’s premises.
• In February 2020, Caitlin requested and was granted 3 week holiday and GGB organized a replacement driver. In October 2020, Caitlin also requested and was granted 1 week of holiday. Caitlin tells you that she was invited to and attended GGB’s annual Christmas party and mid-year social event.
• Caitlin filled out her own tax return in April 2014. She claimed some expenses in preparing her tax return, including her travel to and from home to GGB’s premises, her insurance, and her boots. Caitlin did not undertake any other work while working for GGB.

In deciding how to determine Caitlin’s status, consider:

- Definition of the employee in ERA 2000 in section 6(1)(a) “means any person of any age employed by an employer to do any work for hire or reward under a contract of service;”

- Real nature of the relationship, section 6(2).

- Consider all relevant matters, including those that indicate the parties’ intentions: s 6(3)(a). Labels are not determinative (s 6(3)(b)).

- Leading case – Bryson v Three Foot Six – Supreme Court endorsed Employment Court. Important to look at the written terms and also how the relationship operated in practice. Can also look at the common law test of control, integration, and fundamental test.

The Legal Tests:

1. The intention:

Did Caitlin intend to enter into an independent contractor arrangement?

2. The written contract:

Are there things that point towards employment and if so what are they? [hint there are quite a few things that do point towards employment, eg. termination for serious misconduct points towards employment as an independent contractor would normally be dismissed for breach of contract]

3. What level (if any) of control did GGB have over Caitlin

List any types of control that GGB had [hint, there are quite a few types of control here]

4. Integration Test

Assess how Caitlin was integrated into GGB’s business

5. Fundamental Test

– Was Caitlin performing the services on her own account

6. Industry Practice

Eg, does it look like other similar companies use employees as drivers rather than independent contractors?

On balance, do you think it is more likely that Caitlin is an independent contractor or an employee?

“Agreement Between Owner and Contractor”
31 March 2019.
1. Services to Be Provided
The Contractor is engaged to provide waste delivery and pickup services (Services) within the specified area of the eastern suburbs of Auckland as specified in the Schedule.

2. Contractor’s Obligations
The Contractor agrees to conduct the Services in accordance with the directions of the Owner and at all times be courteous and cooperative to the Owner’s customers, the Owner, and other contractors.
The Contractor will not commit any act which jeopardizes or otherwise adversely affects the reputation of the Owner.

3. Term
The term of the Contractor’s engagement to provide the Services is of an unlimited duration subject to clause 9 (Term).

4. Equipment Provided
The Owner will provide the vehicle used for the Services. The Owner will also provide a uniform to be worn by the Contractor while performing the
Services. The Contractor will be responsible for providing work boots at his or her own cost.

5. Payment
The Owner agrees to pay the contractor $4,500 per month to perform the Services. This is based on a 50-hour week.
Payment will be made monthly into the nominated bank account of the Contractor on the 20th of each month.
Included in the payment to the Contractor is 4 weeks' holiday per year that can be taken in agreement with the Owner and Contractor.

Answer rating: 100% (QA)

The Legal Tests The intention C ait lin did not intend to enter into an independent contractor arrangement She was under the impression that she would be an employee This is evident from the fact that ... View the full answer