Summarised by Centrist
Parliament has passed legislation replacing the Holidays Act with an hours-based system for annual leave, sick leave and public-holiday payments.
Under the Employment Leave Bill, annual and sick leave will begin accruing from a worker’s first day rather than becoming available after six or 12 months.
Annual leave will accrue at a rate equivalent to four weeks a year for someone whose schedule does not change. Sick leave will accrue by the hour and be capped at 160 hours.
Part-time employees will therefore receive sick leave in proportion to their hours, rather than the same 10 days currently provided to full-time and part-time workers.
Casual workers and employees working additional hours will instead receive a leave-compensation payment of at least 12.5%.
Employees may take partial days of leave and cash up 25% of their annual-leave balance. Employers must provide statements clearly showing pay and leave.
Workplace Relations Minister Brooke van Velden said the Holidays Act had produced widespread errors and billions of dollars in remediation costs.
“This Bill delivers on the government’s priority to replace the broken Holidays Act with a leave system which is simple and straightforward,” she said.
Labour opposed the legislation, arguing workers who could least afford to lose entitlements would be disadvantaged.
The changes will not take effect immediately. Businesses and payroll providers have a 24-month implementation period, during which the present rules continue to apply.
