Since February socialists have been following the activity of Fired Up Stilettos (FUS), a group of dancers who have been “kicking up a FUS” ever since they were unfairly sacked from Calendar Girls strip club in Wellington. Braving the possible repercussions, FUS have been blowing the whistle on unscrupulous practices in adult entertainment and agitating for better rights for workers in the industry. Their petition calling for better protections for workers in the industry was submitted to Parliament in June with 7159 signatures. Fired Up Stilettos set out to establish a “nationwide industry standard that protects strippers from unfair treatment.” In doing so, they have injected energy into a broader conversation about workers’ rights, and in particular the rights of workers classified as “contractors.” “Our priority is getting a system that really supports and protects adult entertainers from the stigma, discrimination and abuse that we face both inside and outside the workplace,” FUS organiser Margot Imbargot told us “our main goal is really to improve the rights of strippers as independent contractors. If that brings about positive change for other contractors too, then awesome!”
This broader issue of contractor rights is a live one. Employment court cases have recently called into question the employment status of several groups of workers, including Uber and courier drivers.
Labour came into power in 2017 talking about contractor rights, yet six years later we find them stalling on reforms that could provide greater clarity and more protection for the estimated 150,000 workers who are currently classified as contractors. Using the Fired Up Stilettos’ campaign as a starting point, [ISO publication] The Socialist asks – what are “contractor rights” and why should we fight for them?
The current state of contractor rights
Am I an employee or a contractor? This question is not as easy to answer as it should be. According to New Zealand law a “contractor” or “independent contractor” is self-employed. They are hired by a party (the principal), to perform services under a contract. They are (nominally) independent, invoicing the principal for their income and paying taxes themselves. They are not covered by most employment laws. This is in contrast to an employee, who is employed for “hire or reward” (almost always a wage or salary). Employees are both constrained and protected by employment law, and have certain minimum rights such as minimum wage and leave entitlements.
In practice this distinction is often blurred. Fired Up Stilettos have shone a light on the fact that workers in their industry are currently getting the worst of both worlds in the way they are treated by the venues they contract to. They are prevented from exercising true independence as contractors, being forced to sign contracts which exert a high degree of control over where, when and how they work, while also being denied the protections offered to employees. Under the current system, characterised by ambiguous distinctions between employee and contractor, a lack of oversight, and weak protections for contractors, the temptation is for employers to classify workers as contractors in order to circumvent employment law. There is reason to believe this is happening on a large scale. A Tripartite Working Group of the Ministry of Business, Innovation and Employment, the Council of Trade Unions and Business NZ, found that many sectors of the workforce currently employed as contractors are subject to a “high degree of control” from their employer, suggesting that “serial misclassification” is occurring. Nearly three-quarters of those surveyed by the MBIE stated that they relied on a single firm for all or most of their income. In some industries, such as construction, the use of contracts is so entrenched that employment models are barely used.
The report from this working group provides insight into the dire state of affairs for workers currently classified as contractors. They found that in many cases the contract-based business model reflects an “entrenched power imbalance.” This power imbalance exists from the very outset, with contracts being offered to workers on a “take it or leave it” basis; workers having very little opportunity or ability to assess the terms of a contract, let alone negotiate it in a meaningful way. It is easy for employers to misrepresent the earning potential and flexibility of the work offered, and to push contracts which disproportionately favour them, with terms that give them the ability to terminate contracts without notice, prevent the worker from seeking out other clients and give the principal the ability to vary the terms of the contract without notice. Contractors are taking on business risks without being adequately compensated, and are being forced to take responsibility for their own health and safety while being incentivised to cut corners in this regard. Workers have few avenues for recourse under the current system, and fear repercussions such as being blacklisted if they complain. These issues plague both traditional contracting work and work done through apps, such as ride-share and food delivery. Selling services through these apps is often seen as providing greater flexibility, but as the Uber case has shown these companies often exert a great degree of control over their workers, and as earnings often depend on being available at “peak times” the flexibility is, in large part, illusory. “Predatory” is a word that comes to mind, assessing the current state of contracting work in New Zealand. A majority of the workers who responded to the MBIE’s survey self-identified as “vulnerable workers.”
The Fired Up Stilettos campaign has illustrated some of the dirty practices which employers can get away with in their industry under the current system. They have assessed contracts across the industry and found that “nationwide, dancer contracts are predatory by nature and riddled with fines, retainer bonds and clauses forbidding work at competing venues and media engagement.” Dancers are being fined for “infringements” such as “unkempt appearance”, and “loitering in changing rooms.” Some of the clauses limit dancers’ abilities to establish boundaries and pose clear safety risks for the dancers, such as fines for “rudeness” to customers or management (with “rudeness” defined solely by the management), fines for not removing their underwear at specified times, and requirements for dancers to issue a “warning” to customers who break the rules (such as no touching) before ending a private booking or lap dance. There have been reports of dancers being actively discouraged from reading contracts before signing them. One prospective dancer told Newshub:
The manager held [the contract] on the table covering the first page of writing with his hands and said he needed me to sign this right away… I brought up the fact that I wasn’t comfortable signing right away as I needed a few days away from a loud, club environment to look over the contract. He said it wasn’t important, it was just boring paperwork stuff and I had to sign it now if I wanted to work at the venue.
There is currently very little legal recourse for workers when they have entered a contract based on partial information.
The report of the Tripartite Working Group confirms what many of us already know: that some businesses are using the contracting model in order to avoid employment obligations and undercut those that use the employment model. The cleaning industry is a particularly egregious example of this. Historically, bosses have utilised the contract model in outright attacks on sections of the working class. The 2010 “Hobbit Law” is one example of this. Here, film industry bosses managed to push through legislation that saw all screen workers classified as contractors by default. These workers were robbed of their ability to bargain collectively and of their right to take strike action. This was a deliberate move by film bosses to cut the costs of filmmaking in New Zealand, facilitated by the government aiming to lure large productions to New Zealand. The Forestry industry is another historical example. Traditionally a site of militant unionism, the forestry industry was privatised and restructured towards a contracting model during the neoliberal reforms of the 80s and 90s. The use of individual contracts in this case was aimed at busting unions, and the results of its success were literally deadly. After these reforms health and safety measures were cut back and workplace accidents and fatalities rose dramatically.
What do we want?
Traditionally, the approach taken by the labour movement has focused on the right of workers to assert their status as employees and demand the rights that go with this status. This has been the focus of recent court cases, notably the case of four Uber drivers represented by First Union. In October last year the Employment Court ruled that these drivers were employees, not contractors, based on the “high level of control and subordination which characterised the relationships.” This is consistent with similar court rulings in France and the UK. This case is being widely regarded as a test case that could open the door for other workers to challenge their employment status. Unsurprisingly, Uber is appealing this decision.
Another approach emerging alongside this is to demand greater rights for contractors as contractors. One factor to consider is that not all of those classified as contractors want to be reclassified as employees. Contract work is seen as a useful option by those who cannot commit to standard hours, such as students, parents with young children and disabled people. Sixty-six percent of those surveyed by MBIE said that they enjoyed the independence that being a contractor afforded them. Some groups of workers do not believe that being classified as employees is a good option for them. This is the case for those in the adult entertainment industry, according to Fired Up Stilettos. They say that because of the nature of their work it is important for them to maintain a degree of independence and autonomy from the clubs that they contract to; a greater degree of independence than they are currently being allowed in practice. This is the reasoning behind one of the slogans that appear at their rallies: “we want a venue, not a pimp.” Being classified as employees, in their view, would not allow them the degree of independence that they need to maintain their own safety and personal boundaries.
There are many ways that rights for contractors could be strengthened. Legislation could be used to address the power imbalance between contractors and principals. Pre-contract disclosure requirements could be used to enforce greater transparency. Contractors could be given the right to review their contract every year, the right to recover reasonable costs and improved access to justice. Practices such as fines, bonds and non-compete clauses could be banned. Targeted industry codes could be used to provide minimum standards for contractors working in particular industries.
One issue which is of particular interest to the labour movement is the right to collective bargaining. This right is important not only because of the increased protection and bargaining strength it gives workers, but because it encourages greater numbers of workers to think and act collectively. The capacity for collective action is one of the bedrocks of the labour movement. The right to engage in collective bargaining, while retaining contractor status, is one of the demands of Fired Up Stilettos, and there is now precedence for this in the film industry. The 2022 Screen Industry Workers Act granted workers in this industry the right to bargain collectively to establish baseline contracts for workers in specific occupations. Significantly, these workers still do not have a legal right to strike, but the new law is nonetheless a significant improvement in their position, and it is an example for contractors in other industries to look to.
There is one other avenue that has been considered in the pursuit of better protections for contractors: the recognition of a third category of worker between employee and independent contractor. In 2017 Labour took this idea up, promising in their election manifesto that they would:
Introduce statutory support and legal rights for “dependent contractors” who are effectively workers under the control of an employer, but who do not receive the legal protections that are currently provided to employees under the law [and] extend the right to organise and bargain collectively to contractors who primarily sell their labour.
This was taken up as a promising development by the Council of Trade Unions, but their calls for Labour to progress this promised reform have been ignored. The development of a third category of employment is not among the recommendations of the Tripartite Working Group, and there is a debate to be had about whether introducing such a category would strengthen protections for workers in a meaningful way, or simply introduce further complexity and confusion into the issue of classification.
What’s Next?
Labour’s inaction on the question of contractor rights is frustrating. In the heady days of 2017 they were talking about collective bargaining rights for contractors. From there, they launched a review of contractor rights in 2019, with public consultation undertaken and the Tripartite Working Group formed in 2020. The Working Group made many recommendations, focussing in the first instance on clarifying the legal boundary between employees and contractors. They proposed revising the legislative definition of employee, creating a legal duty on hiring entities to step through a robust decision-making process when considering worker classification. They advocated for more regulatory oversight and the ability for regulators to intervene if they believe standards are being breached. Once this boundary has been clarified, it is reasoned, the issue of strengthening the rights of contractors can be taken up.
In response Labour have done nothing. Consultation on these proposals was supposed to start late last year. Instead, these reforms have been shelved indefinitely. Why? One excuse the Prime Minister gives is that they need to focus on “bread and butter issues.” This delay is part of a slew of policy back-downs that Chris Hipkins says are intended to “free up more government bandwidth and money to focus on the cost of living.” Leaving aside the baffling concept of “government bandwidth,” the current state of affairs is that significant numbers of workers are receiving remuneration “likely to breach minimum standards,” are being forced to work long hours with no guaranteed breaks or leave, and are taking on significant health and safety risks. Moreover, there is reason to believe that this situation is being used to undercut wages and conditions for other workers. To claim that this is not a “bread and butter issue” and that it is somehow unrelated to the cost of living crisis is, obviously, nonsense.
The other excuse is that the government needs to wait for the results of the Uber court case appeal before they can progress this process. They absolutely do not! For one, First Union feel confident that this appeal is likely to fail, and that the real purpose of the appeal is to delay the impact of the original court decision. In light of this, it is unacceptable that the government allows Uber to delay progress on important reforms. What makes this situation more absurd is that the Employment Court has been looking to the government for a lead in their court rulings, following the direction the review and Working Group report has taken and using this as a guide for their decisions. The government is now apparently deferring to the Court, in a strange circular logic that will see workers’ rights go nowhere.
When questioned at a recent Unions Wellington panel on contractor rights, Labour Party candidate Fleur Fitzsimons trotted out this excuse of waiting for the Uber result. She also said that instead of trying to extend collective bargaining rights to contractors, she would rather focus on strengthening unions. This false dichotomy between unions and contractors is short-sighted and limiting on workers’ rights. Thankfully, the unions themselves have shown that they are willing to take up the cause of contractor rights, rejecting this divide-and-rule logic.
The government’s stance on contractor rights is not encouraging for groups like Fired Up Stilettos that are trying to organise for better rights in their industry, but FUS are not discouraged. “The next steps,” FUS organiser Margot tells us, “are to have some members work towards the policy/ legislation change, and then others working on uniting dancers and breaking down stigma. Legislation won’t help us if the workforce isn’t united, but we can’t take collective action legally until the legislation changes! It’s a tricky thing to work with, but if I’ve learnt anything throughout this experience it’s that when a stripper puts their mind to something, it will happen.” The group has met with a variety of MPs, and have had a commitment from the Green Party for a members’ bill, which they are hoping will be picked up by an appropriate minister to go to the select committee. “What I think is the most important thing we have done so far is create a space where strippers feel like they can come out and tell their stories,” Margot explains, “We’ve had people tell us that we helped them recognise they were the victim in this, not the problem, and that knowledge motivated them to stand up for themselves.” We stand in solidarity with the efforts of Fired Up Stilettos and hope that other workers will be inspired to follow their example — stand up for yourselves, and don’t be afraid to kick up a fuss!
