26 Jul 2018

Independent courier drivers could take class legal action

From Checkpoint, 5:09 pm on 26 July 2018

A former Chief Judge of the Employment Court says it would be "worthwhile" for independent contract courier drivers to take class legal action if they can prove they earn less than the minimum wage. 

42193625 - young delivery man checking list on clipboard in van

Photo: andreypopov/123RF

Checkpoint revealed last week that courier drivers employed by companies such as New Zealand Post are required to purchase their own vans, uniforms and scanners, and are not entitled to sick pay or annual leave. 

Numerous drivers have told Checkpoint they earn less than the minimum wage after expenses and tax are taken into account. They have to pay for others to cover them if they take sick leave, and often cannot work for any other company. 

Graeme Colgan told Checkpoint the Kristine Bartlett pay equity case could be the precedent for independent contractors like courier drivers to also take legal action. 

Mr Colgan said the legal process would be slow and would be fiercely defended by companies, and would likely go all the way to the Supreme Court.

"My view is that it would be worthwhile bringing such proceedings," he said.

"No one can guarantee the outcome of any litigation but an assessment on whether it's worthwhile to bring is a lower standard, but I think it's met from what I know."

There would be options in funding court proceedings, including a union helping, class action or help from litigation funding companies. 

If successful, it could change the status of independent contractors to employees across the board. 

"It would depend on the particular form of contract that the drivers have with a particular company but so long as the general principal is established that they are employees and that other companies have similar contracts, then what is likely to happen is the industry would need to re-evaluate the position and make some changes even though they hadn't been a defendant in the court proceedings."

Lawyer Mary Nelson, who specialises in tax and IRD issues, is in no doubt courier drivers are "wage and salary earners with no rights".

"To me it's just a rort. It's really, really unfair. And these people, you know, straight off the bat they're in hardship.

"The only people I think that would be able to relate to this would be solo parents on a benefit… That's how precarious it is." 

David Marra from the Christchurch Budget Service said contractors are increasingly seeking advice.

"You've got a whole lot of people who are doing everything right. They are working, they are trying to be self-sufficient but they can't make ends meet.  

"I would say that every contractor that we have seen, the hourly rate is less than the minimum wage."

Working for free

One courier driver, who said he was paid less than the minimum wage after taxes and expenses, said he also worked for free. 

He spent about 90 minutes a morning, from 5am, six days a week sorting freight. He's not paid till he starts delivering parcels, about 6.30am. 

"We have bought it up, they have looked into it at getting freight sorted and paying us for it," he said. 

But nothing has happened. 

New Zealand Post said drivers sometimes sorted before deliveries in "some smaller, unmanned sites".

It said an hour a day's payment for this was factored into monthly minimum payments.

But it refused to say what those payments were. 

And it's been unable to say what drivers earn, per hour, after costs.