LEGISLATIVE REFORM UPDATE
Since this article was first published on 1 December 2025, the Employment Relations Amendment Act 2026 has come into force. Click here for a link to our article about the new Act and what it means for the Uber decision.
SUMMARY
On 17 November 2025, the Supreme Court released its decision in the case of Rasier Operations BV and others v E Tū Inc and another, unanimously dismissing Uber’s appeal and confirming that four Uber drivers are employees under section 6 of the Employment Relations Act 2000, which provides the definition of an “employee”. This is the first time New Zealand’s highest court has ruled on gig-economy employment status, making this a significant development for businesses using contractor models. The Court stressed that employment status is the gateway to core employment rights, including minimum wage, paid leave, and the ability to unionise, bargain collectively and bring personal grievances.
Both the Employment Court and Court of Appeal held that the drivers were employees while logged into the Uber Driver app. The Supreme Court granted leave in December 2024 to answer a single question: whether the drivers are employees for the purposes of section 6.
E Tū Inc and FIRST Union sought declarations that the drivers were employees when logged into the app, while Uber argued it merely provided a digital platform through which riders and drivers contracted with each other and did not employ drivers at all.
WHAT THE COURT CONSIDERED
As this was an appeal on questions of law, the Court considered whether the lower courts had correctly applied section 6 rather than revisiting the factual evidence. Because the appeal was confined to issues of law, the Court focused on whether section 6 had been applied correctly to the established facts. The Court focused on how the relationship operated in practice and assessed intention, control, integration and the fundamental test to determine the real nature of the relationship under section 6. The Court reiterated that section 6 requires a holistic assessment of all relevant factors to determine the real nature of the relationship
INTENTION
The Court first examined the parties’ intentions at the time the contracts were entered into and considered the following:
- both Uber and the drivers intended the relationship to be one of independent contracting;
- the advertisements that the drivers responded to emphasised being your own boss, flexibility and independence;
- all four drivers signed written agreements that stated they were not employees; and
- several drivers worked on other platforms or around other commitments.
The Court accepted these points but treated intention as only one factor in the overall assessment and not a determining one. The Court emphasised that intention cannot override the substantive reality of how the relationship operates in practice.
CONTROL
The Court identified control as the strongest indicator of employment in this case. The Court found that Uber exercised strong control over how the transport service was delivered and that Uber:
- had argued that riders and drivers contracted with each other for each trip, but the Court rejected that characterisation;
- sets the fares;
- controls the terms of service for riders and drivers;
- manages the complaints and refund process;
- operates the ratings system, which the Court viewed as a tool of behavioural control;
- prevents riders from choosing their driver;
- mediates all communication between rider and driver; and
- rewards work at peak times and imposes practical consequences for cancellations or refusals.
These features together showed that Uber directs and manages the work to a significant degree and shapes how drivers perform the service.
INTEGRATION
The Court considered the drivers to be substantively integrated into Uber’s business and noted that:
- Uber supplies passenger transport services and the drivers carry out that service on its behalf;
- even though drivers supply their own vehicles and decide when to log on, those factors were treated as minor in comparison with the overall structure of the business;
- drivers are the public face of Uber and the Court described the relationship as one of co-dependence;
- drivers cannot build their own goodwill because all customer relationships, pricing and communication flow through Uber rather than through the drivers; and
- customers contract only with Uber.
Taken together, these points showed that the drivers formed part of Uber’s business rather than operating independent enterprises and were not running business of their own.
The Court emphasised that integration asks whose business is truly being carried out — and here, drivers were delivering Uber’s core service rather than operating their own businesses.
FUNDAMENTAL TEST
The Court then weighed the indicators that traditionally point towards a contracting relationship and noted that drivers:
- had flexible hours;
- could in principle work for others; and
- supplied their own vehicles.
The Court compared these with the features that pointed towards employment and found that:
- the level of control exercised by Uber;
- the extent to which the drivers were integrated into Uber’s business; and
- the lack of any real ability for drivers to grow their own enterprise or improve their economic position through skill or reputation,
together outweighed the contractor indicators.
Balancing all factors, the Court concluded that the real nature of the relationship was one of employment and that the contractor indicators did not alter that result. In short, the contractor indicators were not strong enough to displace the clear employment features.
WHY THIS MATTERS
For businesses using contractor models, the message is direct. Courts will continue to look past contractual labels and focus on real control, integration and economic dependence. Businesses that rely on contractor models should reassess those arrangements in light of this decision and the eventual shape of the Bill. Organisations should also assess exposure to historic wage or entitlement claims where contractor arrangements have masked what is, in substance, employment. The decision also highlights increased compliance and litigation risks for businesses relying heavily on contractor structures.
WHAT THE DECISION MEANS FOR THE UPCOMING REFORMS
This decision lands while the Employment Relations Amendment Bill 2025 is before Parliament. The Bill would amend section 6 so that “specified contractors” are excluded from the definition of employee, with eligibility determined by meeting all criteria in the new section 6(7). In summary (and as currently proposed), this section sets out five criteria for a “specified contractor”, requiring a written independent contractor agreement, freedom to work for others, no obligation to be available (or being able to subcontract), no penalty for refusing extra work, and having a genuine opportunity to obtain independent advice. If any of these criteria are not met, then the traditional “real nature of the relationship” test under section 6 remains relevant.
The Council of Trade Unions says the Bill risks cutting across the Court’s reasoning by enabling businesses to structure around employment obligations, and the Supreme Court’s decision is likely to intensify this debate by demonstrating that businesses may still meet the Bill’s criteria even where they exercise substantial control or integration.
LEGISLATIVE REFORM UPDATE
Since this article was first published on 1 December 2025, the Employment Relations Amendment Act 2026 has come into force. Click here for a link to our article about the new Act and what it means for the Uber decision.
