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Distinguishing between a contract of service employee and a contract for services independent contractor is vital in determining workers rights and the obligations owed by their employers Sometimes it is not clear whether a person is an employee or an independent contractor which can lead to disputes between workers and employers This essay discusses how to distinguish between a contract of service and a contract for services by looking at the intention of the parties then by using 4 tests established by the Courts It also looks at the reasons it is important to distinguish between an employee and an individual contractor because of the differing rights obtained by employees and independent contractors First the history about how the employer and worker agreement was previously decided by looking at the Employment Contracts Act changed to looking at the Employment Relations Act to distinguish Previously the Employment Contracts Act 1991 clearly expressed contractual intentions of the parties prevailed over all other considerations httpwwwbzoneconzemployment01836-98161800html so if the contract was entirely in writing that was the end of the inquiry But now under the new law section 62 of the Employment Relations Act 2000 states that the Court or the Authority must determine the real nature of the relationship between them Butterworths 2002 pg 86 To do this it must consider all relevant matters including any matters that indicate the intention of the persons and is not to treat as a determining matter any statement by the persons that describes the nature of their relationship Butterworths 2002 pg 86 The case TNT Worldwide Express NZ Ltd v Cunningham 1993 3 NZLR 681 made it clear that labels or statements regarding a persons employment status are not determinative of determining the real nature of the relationship although they will be relevant httpwwwfindlawconzarticlesdefaultasptask read id 1360siteLE The case that determined these changes in the legal tests for determining the real nature of the work relationship was
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