The Holidays Bill and The Holidays (Four Weeks Annual Leave) Amendment Bill

HUMAN RESOURCES INSTITUTE OF NEW ZEALAND

SUBMISSION TO THE TRANSPORT AND INDUSTRIAL RELATIONS SELECT COMMITTEE on the holiday bill and the holidays (four weeks annual leave) amendment bill

Contact details:

We wish to appear before the Committee to speak to our Submission. We can be contacted at :

Geoff Summers, MHRINZ, Vice-President, HRINZ,

C/o Level One, 35 Victoria Street,

Wellington,

Business : 04 – 499 2964

E-mail : [email protected]

The Human Resources Institute of New Zealand [HRINZ] is an association of people who are interested or involved in the management and development of people at work.

The Institute's objectives are:

• to encourage and support the development of professional knowledge and competence and high standards of performance among its members within New Zealand;
• to promote within New Zealand understanding of all aspects of human resources management and development and its contribution to the performance of individuals and organisations; and
• to provide within New Zealand an authoritative and influential viewpoint on all matters affecting its members and the management and development of people at work.

Introduction

HRINZ commends the Government for its attempt to clarify and simplify Holidays legislation. It also commends the Government for seeking a balanced statutory recognition of the need for employers to manage their business and especially the need for agreement between business and employees as to the timing of holidays.

The main outcome that members of HRINZ would wish to see is an Act that clarifies as far as possible the various issues surrounding holidays for the reason that it is our members who have to implement and administer the legislation.

1. Holidays Bill

Clause 5 – A number of members take issue with some definitions contained in the Interpretation clause:

• Average Earnings – this clause is inadequately defined in the Bill. The divisor needs to be identified to overcome future argument. The following clause is suggested:

‘ Means average weekly earnings calculated by the division of gross earnings by the number of weeks on which work was performed for which wages or salary were earned.’

• Day - The act needs to contain a definition for the term ‘Day’.

The following clause is suggested:

‘ For the purposes of this Act a day is a calendar day however, for a shift that spans two calendar days the day will be the day in which the majority of hours are worked. ’

Clauses 7 and 12 – It is noted that in Clause 7, there is reference in sub clause (4) to ‘total earnings’ and yet in Clause 12, there is reference to ‘gross earnings’. A number of members believe that there needs to be some consistency in the language of ‘earnings’. There are concerns that two meanings could be taken from the two terms.

Clause 17 – A member notes that this Clause is unnecessary and may cause confusion. Clause 6 adequately addresses interpretation of a week in terms of entitlement.

Clause 18 – A number of members felt that the provision in sub clause (1)(a) concerning an employee taking annual holidays after the date on which the employee’s entitlement to the holidays arose, was too prescriptive and for an employee to have to work a year, before taking a holiday. It was felt that this issue would be best to be left as between employer and employee. An employee should be able to agree with their employer and be able to take holidays on an ‘as-you-go’ basis.

Clause 21 – One member felt that the formula in sub clause (2) may be difficult to automate. The member suggests the following clause:

‘ In respect of each week of an annual holiday, the holiday pay of a worker shall be at the rate of the average weekly earnings during the year in respect of which the worker has become entitled to the holiday .’

Clause 35 – there was support and opposition from a number of members concerning the provision that allows an employee to take annual holidays if sick or bereavement leave is exhausted.

Arguments for are based on the need for a ‘safety net’ for those who may have more that their fair share of unfortunate circumstances.

Arguments against are based on annual leave being used only for ‘work balance and the realigning of employees’ perspective.

Clause 38 – There was general support from members for the clarification of public holidays such as ANZAC and Waitangi Days.

Clarification is required concerning whether ‘public holidays’ can be opted out in an employment agreement or by agreement as between employer and employee.

Clause 46 – A number of members opposed the provision for payment of time and a half for working on a public holiday. It was felt that those on a salary provision should be excluded as this would be part of their general remuneration.

This was especially emphasised by those in the hospitality industry where there is not the normal Monday to Friday 08.30 hrs to 17.00 hrs working week but a 24 hours/7 days a week working environment.

Clause 59 – There is support from our members for the provision of carrying over sick leave on the basis of a possible decrease in absenteeism because employees would not feel the need to use their full 5 day entitlement for fear of losing them at the conclusion of each 12 month period.

Clause 61 – There appeared to be a general agreement amongst those who responded that 5 consecutive days was too long for there to be no proof of illness by way of a medical certificate. Respondents felt that the period should be from 2 to 4 days, at the most, as is the practice in other countries, such as Australia and the UK.

Clause 62 – Concern was expressed over the issue of granting bereavement leave, especially at sub clause – (2)(b). There appears to be a burden placed on the employer to discern if the bereavement leave is valid. There is a potential for disputes under the Clause as it is drafted.

Clause 63 – A number of members felt that the clause should be worded ….’ An employer must provide an employee with-

up to 3 days bereavement leave…………’

General comments

There was concern expressed from those representing industries that worked on a 24 hours/7 days a week basis, such as the hospitality, tourism industries and those industries that used much rostering of personnel, that the Bill does not address the issues faced by these industries and appeared to be based upon an 5 day week, Monday to Friday, 8 hour day from 08.30 to 17.00.

2. Holidays (Four Weeks Annual Leave) Amendment Bill

There was an equal number of respondents who agreed with this Bill’s recommendation of an increase in minimum annual leave entitlement to those who did not.

Those who supported this Bill, did so with reference to the following issues:

· work/life balance;

· health and safety considerations;

· the need for NZ legislation to be in line with other similar countries.

One respondent pointed out that under the present annual leave entitlement, upon a 2 week annual shut down, an employee would only have one weeks leave to use in a 50 week period.

Opponents of the increase in annual leave entitlement point to the increased costs that would occur as a result of and increase in annual leave.