Understanding the legal wrangle that could reshape high performance sport

It is a political battle that has been brewing for several years.

The landmark employment case brought against High Performance Sport NZ by a collective of athletes from two of the country’s biggest Olympic sports is set to once again expose the deep fault lines that exist with the elite sporting system.

The group, spearheaded by Olympic great Mahe Drysdale, includes around 60 rowers and cyclists, who want better rights for athletes, improved well-being and financial stability. But the case before the Employment Relations Authority is likely to hinge on the central issue of whether elite athletes are deemed employees of the government sports agency.

To understand the origin story of the dispute, you need to go back to 2018.

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Where it started

This was the year of New Zealand sport’s great reckoning. Over the course of 2018 a series of high profile athlete welfare scandals emerged cycling, hockeyand women’s football, forcing a string of reviews into these troubled environments. Behind the scenes other sports like rowing, canoe racing and triathlon were also rocked by cultural issues.

With each report, a familiar theme emerged: a clear power imbalance between national sporting organizations (NSOs) and the athletes vying to ‘earn the fern’ directly diminished athlete welfare.

Around the same time as the individual programs were coming under the microscope, Stephen Cottrell’s review of elite athlete rights and welfare laid bare the system-wide issues. The 120-page report detailed clear evidence of problems emerging in elite sport in New Zealand because of a “lack of genuine focus on athlete rights and welfare”.

Double Olympic champion Mahe Drysdale is co-chair of The Athletes' Cooperative, which has launched an employment case against High Performance Sport NZ.

John Cowpland / www.photosport.n

Double Olympic champion Mahe Drysdale is co-chair of The Athletes’ Cooperative, which has launched an employment case against High Performance Sport NZ.

As Cottrell concluded in his report, “the key ongoing issue to address … is the inequality of bargaining power between NSOs on the one hand and Elite Athletes on the other.”

In the wake of the reviews High Performance Sport NZ moved quickly to act on the findings.

There were further system-wide examinations, working groups established, new complaints processes put in place, the development of new strategy, and the implementation funding model designed to “place a far greater focus on investing in environments that optimize potential and which empower individuals to speak up and for the athlete’s voice to be heard”.

But over the years, hopes that these measures would lead to transformative change within the system have faded, with evidence the same athlete well-being issues were continuing to arise in high performance environments.

And then…

Last year came the tragic event athlete advocates had long feared. Olivia Podmore, one of the country’s top sprint cyclists, died in a suspected suicide. She was just 24.

PETER MEECHAM/STUFF

Speaking in May 2022, after the conclusion of an inquiry into Cycling NZ, Nienke and Chris Middleton – Olivia Podmore’s mother and stepfather – said they were hopeful of positive changes for athlete welfare in the future.

For the second time in three years, an independent inquiry into Cycling NZ and its government partners was held.

That sports officials had ended up back here again so soon reinforced the long-held view among athlete welfare experts that the only way to create meaningful cultural change within the environments is for the athletes to have independent representation by a body empowered to exert real power.

“We think a core pillar of it, and what we’ve been talking to the government and Sport NZ about for a long time is, we think independent representation for the athletes is really important, and meaningful dialogue and engagement with the coaches and athletes and the people that make up these environments on a consistent basis like a genuine employment environment is absolutely crucial,” Rob Nichol of the Athletes’ Federation told Stuff in August 2021.

“It hasn’t been allowed to happen in too many of these environments.”

The Cycling NZ inquiry panel, headed by Mike Heron KC and senior academic Sarah Leberman, reached a similar conclusion.

In its final report released in May this year, the panel strongly emphasized the need for the system to have a strong, truly independent athlete voice mechanism.

The panel also recommended Cycling NZ consider making its high performance athletes employees rather than contractors “in recognition of the fact that they are under CNZ’s effective control and train/compete at CNZ’s direction”.

Olivia Podmore celebrates winning gold in the women's team sprint with Natasha Hansen during the Cambridge UCI Track World Cup in 2019.

Phil Walter/Getty Images

Olivia Podmore celebrates winning gold in the women’s team sprint with Natasha Hansen during the Cambridge UCI Track World Cup in 2019.

“An employment model is not impossible. HPSNZ and CNZ each employ a significant number of people. Athletes are their raison d’être or reason for being, without them the [high-performance programme] would not exist – they deserve the same protection,” the report read.

High Performance Sport NZ formed an Athletes Leaders Network last month to provide a voice for athletes, despite concerns the new body would be “compromised”. The government agency countered that the new body is “organisationally separate” from High Performance Sport NZ, and it has no say in how it is run.

There also appeared to be a reluctance by sport bosses to genuinely examine a shift to an employee model. Privately, within the glass-walled offices of High Performance Sport NZ, the option has been thought as too expensive and unworkable.

Officials also reason the additional financial burden of making athletes employees would restrict the number of athletes they can support, thereby further impacting athlete welfare.

What happened?

Frustrated with the endless spin cycle of reviews, The Athletes Federation – New Zealand’s largest, and most well-funded, athlete advocacy group – have decided to force the issue themselves.

The Federation, headed by Roger Mortimer, is behind the move by the cyclists and rowers to unionize themselves. It is also understood to be helping bankroll the employment case, which has the potential to set a precedent that would lead to a fundamental shift in the legal rights of all contracted athletes.

The new group, known as The Athletes’ Cooperativeare co-chaired by Drysdale and Tokyo Olympian Kirstie Klingenberg (nee James). Its inaugural board features a high-profile roster of athletes including Olympic gold medalist rowers Emma Twigg and Tom Mackintosh, alongside cycling stars Sam Dakin and Sam Bewley.

Olympic gold medalist Emma Twigg is among a number of high-profile athletes behind The Athlete Cooperative.

Naomi Baker/Getty Images

Olympic gold medalist Emma Twigg is among a number of high-profile athletes behind The Athlete Cooperative.

But its existence, until now, has largely been kept under wraps as the Cooperative worked behind the scenes to set up the landmark legal challenge against High Performance Sport NZ.

The dispute wound up with the Employment Relations Authority following failed attempts by the Cooperative to enter into collective bargaining with the government sports agency.

Drysdale, a long-time agitator for change within the high performance system, said the athletes want to be able to negotiate conditions that work for them, rather than an agreement that is imposed upon them.

Stuff understands that the government agency’s position is that the athletes are not their employees, and therefore it cannot enter into negotiations with the Cooperative. It says athletes receive a grant from the government sports body, as opposed to wages, and making the athletes employees of High Performance Sport NZ would interfere with the sovereign rights of the actual sporting bodies the athletes represent.

According to Cottrell, who examined the contractor employee debate in his 2018 review, when determining whether a person is a contractor or employee, the employment court will look at the true nature of the relationship between the parties and all relevant factors.

The case for the athlete group, who are represented by prominent employment lawyer Andrew Scott-Howman, may be compelling.

Earlier this year, Equal Employment Opportunities Commissioner Saunoamaali’i Karanina Sumeo slammed the “exploitative” conditions of the country’s high performance system, describing the financial support being received by athletes as “slave labor type salaries”.

Currently, High Performance Sport NZ invests $11.82 million per year in targeted athlete funding, with base training grants starting at $25,000, while Olympic and Paralympic medalists can receive up to an additional $40,000 per year. The current minimum wage is a shade over $44,000 per year.

Equal Employment Opportunities commissioner Saunoamaali'i Karanina Sumeo.

Supplied

Equal Employment Opportunities commissioner Saunoamaali’i Karanina Sumeo.

“We’re expecting these people to be … ambassadors for sport, for our country, and that is how much they are worth?”

But the more difficult hurdle to clear for the Cooperative may be the argument that athletes are effectively employees of High Performance Sport NZ, rather than their respective sporting bodies.

The decision to take the case against the government agency was clearly a strategic one, setting up a fascinating test case that will likely be closely watched not only by other athlete groups in New Zealand, but overseas bodies.

The issue of whether elite athletes can be considered employees has been tested before in overseas courts, with a global trend of athletes turning to employment bodies in an effort to assert their legal rights.

In 2018 British cyclist Jessica Varnish brought a case through the UK’s employment tribunal that she should be considered an employee of British Cycling and UK Sport and therefore subject to certain protections under the law – including sick pay, a pension and the right to sue for unfair dismissal.

If Varnish, a former world silver medallist, had been deemed an employee, it would have allowed her to pursue a claim against both British Cycling and UK Sport for unfair dismissal and sex discrimination. However, Varnish’s case ultimately failed on appeal.

But the case reinforced to sport integrity experts here is that the only way to achieve fundamental change within the sports system is to pursue remedies outside of it.

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