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Legistrative changes under the Holiday Act

  • Employees will be able to exchange up to one week’s annual holidays for cash.
  • Employees will be able to transfer public holidays to another working day.

These changes are aimed at reducing direct costs and compliance costs so businesses can invest their time and money in growing their business and creating more jobs.

Your existing employment agreements will be out of date by 1st April 2011.  Contact us so we can help you keep your contractual obligations.

The maximum penalties for non-compliance with the Holidays Act has doubled from $5,000 to $10,000 if the employer is an individual and from $10,000 to $20,000 if the employer is a company or other body corporate.

Questions and answers for cashing up holidays.

Q. How do employees go about cashing up holidays?

A. They will have to ask you in writing and you will have to reply in writing.  You can both agree on a process in your employment agreement.

Q. Will they have to give a reason for asking to cash up holidays? A. No. Q. Will we have to give a reason for declining?

A. No.

Q. How will  we  know  whether we should  allow them  to  cash up  annual  holidays?

A. Individual employers will be able to have a policy as to whether or not they allow holidays to be cashed up. It is your decision to approve or decline each request.

Q. Will our cash up policy have to apply to everyone at the workplace?

A. No. You will be able to apply the policy to all or part of their workplace, to suit your business needs.

Q. Will we be able to encourage or pressure employees to cash up holidays?

A. No. It can only be done at their request.

Q. What will happen if both parties dispute the value of cashed up holidays and/or the amount of holidays they cashed up?

A. Labour Inspectors can determine this for you.

Top Tips you may have forgotten.  

For employees whose hours of work and pay are irregular, their payment for sick leave, bereavement leave, public holidays and alternative holidays will be calculated by averaging gross earnings for the preceding 52 weeks or whatever lesser period the employee has been with that employer.

Employers are able to ask for proof of sickness or injury within three consecutive days of an employee taking sick leave, but will have to cover the employee's reasonable costs in obtaining proof. Current law stipulates that employers must first have ‘reasonable grounds' to question whether sick leave being taken isn't genuine before asking for a medical certificate.

SOURCE: Hon Kate Wilkinson