WELLINGTON - Federated Farmers is concerned that the Employment Relations Bill may turn sharemilkers into employees.

The Real Estate Institute is also concerned about the status of real estate agents.

The bill says a primary consideration in deciding whether A is an employee of B, as opposed to an independent contractor, is the extent to which the work is subject to B's control and direction or integrated into B's business.

It says this will carry more weight than how the relationship is described in any contract or arrangement.

Federated Farmers vice-president Tom Lambie says the concerns relate less to the classic 50:50 sharemilking agreement, where the sharemilker provides the cows and some of the farm machinery in return for half the income, than to variable, lower-order agreements, where the sharemilker's contribution and income share are lower.

Such agreements are often stepping stones for young farmers getting into the industry, he says.

"We want to make sure sharemilking is outside the ambit of the bill. We have talked to officials in [Labour Minister Margaret Wilson's] office and they are looking to clarify the situation for us."

More generally, the federation is worried about the implications of the bill as the trend is for farmers to rely more and more on contractors.

"We need the maximum amount of flexibility to give the efficiencies we need to remain competitive."

Meanwhile, Real Estate Institute president Max Oliver said the Real Estate Agents Act had been amended to allow agents to be either employees or independent contractors, as they wished.

If sales staff all became employees it could alter their tax status and impose obligation on their firms, like ACC, he said.

"We are getting legal opinions on the matter, and we will be making submissions to the select committee."

But with submissions to the committee closing on May 3 and the legislation intended to come into effect on August 1, "you would have to say they are not looking for the select committee to go very long."