Full time care worker deemed to be employee...

The Employment Relations Authority has determined that a woman who acted as a full time carer for a sick man was an employee.

The woman lived at the man’s house and offered care and household support on a 24/7 basis. The initial agreement stated that the woman would receive free board and $100 per week in return for her services.

As time went on the man’s condition worsened significantly and he needed far more care than he did when the initial agreement was made.

A discussion about the woman’s employment status took place between the employer and the woman. During this meeting the employer decided that he wanted the woman to hold the status of contractor, so that he wouldn’t be liable to pay things like holiday pay or KiwiSaver.

The employer’s accountant prepared a contractor agreement and sent it to the woman. The woman refused to sign it, stating that it was contrary to the agreement that was in place.

Despite this refusal the employer began to pay the employee $1600 per week and she was informed that she would have to pay her own taxes and ACC.

After a few months of working under this arrangement the employee was suffering from stress and was experiencing other negative health effects as a result. She was advised to take two weeks of sick leave by her doctor.

After this two week period the employee offered to come back to work, but was unable to continue working on a 24/7 basis. She said that she needed two days off per week and had arranged a rental property so that she could stay somewhere else during these days off.

The employer informed her that this was unacceptable and that she could not return to the property. The employer changed the locks shortly after informing her of this.

A few weeks later this dismissal was confirmed in writing. The employee continued to be paid for four weeks after this dismissal as payment for her notice period.

The Authority noted that the employer only wished to differentiate things from the original agreement after discovering that he could be held liable to pay the employee holiday pay and ACC. It was decided that the woman was an employee as she was not in business on her own account.

If there is confusion around the requirements of each party in an employment agreement it pays to seek advice from a professional with experience in the area.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.

Alan Knowsley & Matthew Binnie