How to ensure you receive your full holiday and leave entitlement as a NZ employee

Introduction

Minimum rights to public holidays and leave

It's important that you as an employee are aware of your rights to public holidays, annual leave and other types of leave. Your minimum entitlements are contained in the New Zealand HOLIDAYS ACT 2003.

You may be entitled to additional leave under the terms of your particular employment agreement. Your agreement cannot take away any of your rights and entitlements under the Act.

Information your employer must give you

When you start work, your employer must tell you about your minimum rights under the HOLIDAYS ACT 2003. They must also tell you that you can get more information from your union (if you're a member) or from the Department of Labour.

Public (or "statutory") holidays

The 11 public holidays

• Christmas Day
• Boxing Day
• New Year's Day
• 2 January
• Waitangi Day
• Good Friday
• Easter Monday
• ANZAC Day
• Labour Day
• Queen's Birthday
• your province's Anniversary Day

When am I entitled to be paid for a public holiday?

You will receive a paid holiday for each of the 11 public holidays if it would normally be a working day for you. If you would normally work any amount of time on a public holiday, that day must be treated as normally being a working day for you.

If you and your employer can't agree on whether a particular day would normally be a working day, you can approach the Labour Department and a Labour Inspector will decide the issue.

What if I work the public holiday?

You can agree with your employer that you will work on the public holiday, in which case you must:

• be paid at least time and a half for that day (see below), and
• be given an alternative paid holiday

The alternative holiday is to be taken on a day agreed between you, and on a day that would normally be a working day for you. The alternative holiday must be a whole day off, even if you worked only part of the public holiday.

If you work a public holiday that would not normally be a working day for you, your employer must pay you at time and a half, but you're not entitled to an alternative paid holiday.

Calculating your pay if you work a public holiday

The amount you must be paid for working a public holiday is whichever is the greater of the following two amounts:

• what you would get under your employment agreement for your hours worked that day, not including penal rates, plus half that amount again, or
• what you would get under your agreement for your hours worked that day, including penal rates

"Penal rates" is limited here to any additional amount paid to compensate you for working a particular day of the week or a public holiday. It doesn't include, for example, additional amounts for working more than five days a week, or for working at particular times (such as overtime or shift allowances).

So in other words, you're entitled to either the "penal rates" in your agreement or to the minimum time and a half required under the Holidays Act, whichever is more, but not both. If, for example, you work a public holiday that falls on a Saturday, and your agreement gives you time and a quarter for working Saturdays, you must be paid the time and a half minimum under the Act. If on the other hand you work a public holiday that falls on a Sunday, and your agreement provides for double-time on Sundays, you must be paid the double-time under the agreement.

There's a temporary exemption for employers who already pay employees for working on public holidays as part of their regular pay. The employer can continue doing this temporarily, if this had previously been genuinely negotiated into the regular pay in order to achieve the same ends as the minimum requirements in the Act. In the case of individual agreements, the exemption lasts until 1 April 2007. In the case of collective agreements, it lasts until 1 April 2007 or until a new collective agreements comes into force, whichever is earlier.

From 1 April 2004 all new employment agreements must include a provision confirming your right to be paid either time and a half or penal rates contained in the agreement, whichever is more, if you work a public holiday. Agreements already existing on 1 April 2004 must be amended to include this the next time they're amended, but not later than 1 April 2005 (except that in the case of the temporary exemption explained in the last paragraph, the agreements don't have to be amended until that exemption ends).

When will I get paid for the public holiday?

You must be paid for it in the pay that covers the pay period in which the holiday falls.

Special rules for Christmas and New Year

In addition to these general rules, the HOLIDAYS ACT 2003 has special provisions that apply when Christmas or New Year's Day falls on a Friday, Saturday or Sunday.

What if I'm sick or have a bereavement on a public holiday?

If you're required or have agreed to work a public holiday, but you don't in fact work that day because you're sick or injured or have a bereavement, the day will still be treated as a public holiday, rather than as sick leave or bereavement leave. However, you're entitled only to your normal pay, not time-and-a-half, and you're not entitled to an alternative day's holiday.

Annual leave

How much annual leave am I entitled to?

As of April 1 2007, you are entitled to at least four weeks' paid holiday leave each year. This becomes due at the end of each year of continuous employment with your employer. A 12-month period of employment is still "continuous" even if it includes periods of parental leave, time on ACC, or unpaid leave of any kind.

If you work part-time you'll be entitled to three of your normal working weeks – for example, if you work 20 hours a week you'll be entitled to three 20-hour weeks off work and on pay. If you and your employer can't agree on what is a genuine working week for you, a Labour Inspector can decide the issue.

Public holidays that fall during your annual leave are treated as public holidays, not annual leave.

The minimum of three weeks' annual leave will increase to four weeks on 1 April 2007.

How is my annual holiday pay calculated?

Your holiday pay must be at the rate of:

• your ordinary weekly pay as at the start of the holiday, or
• your average weekly earnings for the 12 months immediately before the last pay period before the holiday,

whichever is more.

When must my annual holiday pay be paid?

Your employer must pay you your holiday pay before you take your holiday, unless you agree that you will be paid in the pay that covers the period in which your holiday falls.

Who decides when I can take my annual leave?

Your employer must allow you to take your three weeks of leave within 12 months after you became entitled to them. The employer must also allow you to take at least two uninterrupted weeks of leave if you choose this.

Aside from those requirements, the issue of when annual leave is taken is a matter to be negotiated between you. But your employer cannot unreasonably refuse to allow you to take annual leave.

Your employer can require you to take your annual leave at a particular time if you cannot agree on when to take them. But the employer must give you at least 14 days' notice of this.

You and your employer can agree to you taking annual leave in advance – that is, before they become due at the end of a year of employment.

What happens when I leave my job?

If you leave your job during the first year, as of April 1 2007 you're entitled to be paid 8 percent of your gross earnings since you started the job. (This increases to 8 percent on 1 April 2007.)

If you leave your job after the first year, you're entitled:

• to have any unused annual leave paid out in holiday pay, and
• to be paid 8 percent of your gross earnings since you last became entitled to annual leave (increasing to 8 percent in 2007)

Closedown periods

Your employer may require you to take annual holidays during a closedown period, but must give you at least 14 days' notice. If you don't have enough leave owing to cover the whole closedown, you and the employer can agree that you will take some of the closedown as leave in advance.

If you haven't accrued any annual leave by the closedown, the employer can require you not to work during the closedown. You will be paid 6 percent of your gross earnings since you started the job (if you've worked there less than a year) or since you last became entitled to annual leave (if more than a year).

Employers can have only one closedown period a year. They can have different closedown periods for different parts of the business.

Sick leave

When do I become entitled to sick leave?

After you've worked for your employer for six months, you become entitled to five days' paid sick leave for each year you work after that. Over those six months you must have either:

• worked continuously for the employer, or
• worked an average of 10 hours a week, and not less than one hour a week or 40 hours a month

You and your employer can agree that you can take sick leave in advance, with the amount taken in advance being deducted from your entitlement when it becomes due.

In what situations can I take sick leave?

You can take sick leave if:

• you're sick or injured
• your spouse or partner is sick or injured, or
• someone who depends on you to care for them (such as a child or elderly parent) is sick or injured

Can I carry over sick leave?

Yes, you can carry over unused sick leave to the following year. You can carry over up to 15 days, so that in any year you can have a maximum of 20 days current entitlement to sick leave. Your employer can also allow you to carry over more than this.

When you leave your job you are not entitled to be paid out for unused sick leave.

Do I have to provide a doctor's certificate?

Your employer can require you to produce a doctor's certificate or other proof that you are sick or injured if the sickness or injury is for more than three consecutive days. This applies whether or not any of those consecutive days would normally be working days for you. So if, for example, an illness lasts from Friday to Monday inclusive, the employer is entitled to require a doctor's certificate.

Your employer can also require you to provide proof within the three consecutive days if they have reasonable grounds to suspect that your sick leave isn't genuine. The employer must tell you, as soon as possible after forming this suspicion, that they require proof. They must agree to meet your reasonable costs for getting the proof (for example, pay for your visit to your GP).

Your employer doesn't have the right to tell you which doctor or other health professional you must go to to obtain proof.

Payment of sick leave

You must be paid sick leave in the pay that covers the pay period in which you took the leave.

But if you fail, without a reasonable excuse, to provide proof of sickness or injury when required (see above), your employer doesn't have to pay you until you provide that proof.

Bereavement leave

When do I become entitled to bereavement leave?

You become entitled to bereavement leave after you've worked for your employer for six months. Over those six months you must have either:

• worked continuously for the employer, or
• worked an average of 10 hours a week and not less than one hour a week or 40 hours a month

You and your employer can agree to you taking bereavement leave in advance – that is, before you have worked for the employer for six months.

In what situations can I take bereavement leave?

You are allowed to take three days bereavement leave if any of the following people die:

• your spouse or partner (including a same-sex partner)
• your parent
• your child
• your brother or sister
• your grandparent
• your grandchild
• your spouse's or partner's parent

If someone other than one of those people dies, you are allowed to take one day's bereavement leave if the employer accepts that you've suffered a bereavement, taking into account relevant factors such as:

• how close you were
• whether you have significant responsibilities for organising the ceremonies relating to the death
• any cultural responsibilities that you have in relation to the death

There is no maximum total number of days of bereavement leave that you can take in any one year.

Payment of bereavement leave

You must be paid bereavement leave in the pay that covers the pay period in which you took the leave.

Enforcing your rights under the Holidays Act

What can I do to recover unpaid holiday pay?

You can recover unpaid holiday pay by taking your employer to the Employment Relations Authority. Your union or a Labour Inspector can also take your employer to the Authority on your behalf.

A Labour Inspector can also take a penalty action to the Authority against your employer for breaches of your rights under the HOLIDAYS ACT 2003. A penalty can be up to $5,000 if the employer is an individual, and up to $10,000 if it's a company or other type of incorporated body.

The New Zealand Employment website has an additional article on Payment for Leave and Holidays.

Other New Zealand Employment Law resources

• The New Zealand Government website Employment is an additional useful guide.
   
• The NZ Employment Relations Authority assists you further seek assistance in resolving employment related issues. It is an independent body.
   
• The NZ Employment Court allows you to challenge a decision made by the Employment Relations Authority.
   
• The NZ Human Rights Review Tribunal assists with issues of human rights and privacy at work.
   
• The NZ Employment Relations Authority has a database of previous cases for review.
   
• The NZ Government website Employment has a free tool for creating employment agreements - help yourself.

 

Cautionary notes

• Not all employers understand their obligations under the Holidays Act. Any employer or employee who is in doubt about their obligations and rights under the Act should consult a lawyer.