Hamish Fletcher

Business reporter for the NZ Herald

Spotlight falls on holidays law reform

Legal firm calls for change to how leave is calculated but union boss warns workers could lose.

The Holidays Act - which covers how workers accrue and are paid out their leave - needs to be rewritten, modernised and simplified.
The Holidays Act - which covers how workers accrue and are paid out their leave - needs to be rewritten, modernised and simplified.

A leading law firm is calling for changes to how leave is calculated and paid out but a union leader is warning workers could lose out.

Simpson Grierson this week released a report saying changes to holiday laws were overdue.

The Holidays Act - which covers how workers accrue and are paid out their leave - needs to be rewritten, modernised and simplified, the law firm said.

"It is time to rewrite it and try to make it a bit more modern and user-friendly because of the varied workplaces and work patterns."
Simpson Grierson senior associate Rebecca Rendle

Senior associate Rebecca Rendle said the current law was based on legislation drafted in 1981 and while amendments had been made since then, more tinkering around the edges probably wouldn't help.

"It is time to rewrite it and try to make it a bit more modern and user-friendly because of the varied workplaces and work patterns [of today]," Rendle said.

The call for the changes was spurred by a survey Simpson Grierson did in December involving 196 of its "clients and contacts" in human resources.

Based on the survey results, the firm is pushing for two particular changes to "key areas" of the law.

The first is making one formula for paying all types of leave instead of the present four formulas.

Two of these formulas were for annual leave and the two others for bereavement, sick leave and public holidays, Rendle said.

"You've got two types of leave and then two types of formula for each, so it does make it difficult to know whether you're picking the right one," she said.

"Time off is a week, whatever that week looks like. It's incredibly important that people are able to take periods of time off, not hours off."
Council of Trade Unions president Helen Kelly

Simpson Grierson is also recommending changing the law so leave is accrued and paid in hours.

Leave is currently accrued and paid in weeks for annual leave and in days for other types of time off.

The report said most survey respondents operated a payroll system where leave was worked out in hours.

"As this is inconsistent with the act, it adds an extra layer of complexity around how calculations are made and the potential for error," it said.

"While a work day or a work week may vary greatly between workplaces and between employees, a work hour is the same for everyone."

But a union leader said changes were not needed, that the law had only recently been reviewed and the Government "had better things to do than have another look at it".

Council of Trade Unions president Helen Kelly said the reason workers were not given leave in hours was because it was "time off, it's not wages".

"When you have time off you have whole days, you don't have hours [off]. So if you're part-time and you work four hours a day every day, you get a week off ... and [get] paid 20 hours. If you're only allowed to take 20 hours off, and you were say a casual worker, you might be asked to work in the afternoons or whatever and get paid 40 hours," she said.

"Time off is a week, whatever that week looks like. It's incredibly important that people are able to take periods of time off, not hours off."

- NZ Herald

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