Australia markets closed

    -12.60 (-0.17%)
  • ASX 200

    -14.10 (-0.20%)

    +0.0067 (+1.02%)
  • OIL

    -1.58 (-2.08%)
  • GOLD

    +34.50 (+1.68%)
  • Bitcoin AUD

    +1,051.07 (+1.81%)
  • CMC Crypto 200

    +11.20 (+1.41%)

    +0.0070 (+1.15%)

    +0.0015 (+0.14%)
  • NZX 50

    +37.31 (+0.33%)

    +49.71 (+0.31%)
  • FTSE

    +75.60 (+1.01%)
  • Dow Jones

    +294.61 (+0.82%)
  • DAX

    +182.09 (+1.12%)
  • Hang Seng

    -212.58 (-1.25%)
  • NIKKEI 225

    -55.38 (-0.17%)

Gig worker rights still unclear after High Court rulings

The backs of two gig workers from Deliveroo on bikes on a street.
The decisions have implications for businesses such as Uber and Deliveroo that use gig workers. (Source: Reuters) (REUTERS)

Gig workers in Australia are likely to keep missing out on worker benefits reserved for employees, in the wake of two fresh High Court decisions.

The judgments follow disputes in Australia and around the world about the rights of gig workers using ride-sharing and delivery-service platforms.

Currently, these workers do not have access to standard benefits afforded full- and part-time employees, such as minimum wage and super contributions.

For companies reliant on self-employed contractors, the two cases will most likely embolden them to continue business as usual and employ workers as independent contractors, provided these companies have water-tight contracts in place.

The rulings are likely to help define the contested relationship between companies and gig workers but have not resolved the issue entirely.

In one case, the courts ruled in favour of a backpacker working for a labour-hire company. Despite the labourer signing an agreement as a “self-employed contractor”, the court deemed his working relationship out of step with this classification.

In another case, the High Court ruled in favour of a lighting company that had engaged two truck drivers as contractors. In this instance, the High Court determined that according to a contract the two drivers had signed in the 1980s, the pair were indeed contractors who owned and maintained their own trucks and invoiced the company for their work.

For many in the business community, the rulings represented a sensible development. In similar cases overseas, ride-sharing and delivery companies argued that recognising drivers as employees would irreparably damage their business models and they would be unable to employ people at all.

What this means for gig workers

Employment law expert professor Andrew Stewart, from the University of Adelaide, told Yahoo Finance that what tied the two High Court cases together was, “not so much the results but the reasoning that the court used to get there”.

Both cases favoured strict interpretation of contractual agreements, which is a departure from convention where courts have put greater emphasis on real-life working arrangements.

That is, in the past, if a worker had signed a contract as a self-employed contractor but was effectively treated as an employee, courts would put more emphasis on this workplace dynamic.

However, both these cases suggest the court is now more likely to default to the fine print.

“What it says is it doesn't matter as a matter of economic reality or actual practice that this person is working as part of the business, just as long as you get the contract right and it can suggest they are running their business, the courts will uphold that,” Stewart said.

He said this would have implications for platform businesses such as Uber and Deliveroo, who tended to draft their contracts to suggest that workers ran their own businesses and that the platforms just exist to help them find clients.

“The counter argument is the platforms are running a business and are employing the workers as part of their business,” Stewart said.

He said the controversy “isn’t going away”.

“We will continue to see litigation about the status of gig workers.”

One case involving a Deliveroo driver was put on hold to wait for yesterday’s rulings.

Gig-economy rights a ‘job for parliaments, not courts’

Stewart added that the decisions suggested action to improve the rights of independent workers was likely required at the parliamentary level rather than in the existing legal system.

There has been some appetite for policy interventions at the state level, particularly Victoria.

The upcoming federal election could also become a battleground for the rights of gig workers.

Follow Yahoo Finance on Facebook, LinkedIn, Instagram and Twitter, and subscribe to the free Fully Briefed daily newsletter.

Banner to sign up to Yahoo Finance newsletters.
Banner to sign up to Yahoo Finance newsletters.