Taking a Vacation in New Zealand is About to Become Easier (...to Administer)

In 2019 when the Holidays Act Taskforce was formed, 87 submissions were received from employers, unions, payroll providers and payroll technology companies.  There was general commentary from a cross section of submitters that the Act was ‘confusing’, lacked prescription, and was difficult to comply with.  It was unclear if employees were being paid correctly, the system was inequitable and favoured employees who worked certain days and was open to ‘gaming’ from employees.  Technology providers complained about the difficulty of building software products which ensured compliance with the Act. 

While the reform is yet to pass parliament, it is expected that the revised Act will provide clearer definition of earnings, as well as greater clarity on vacations for employees who work inconsistent or flexible work patterns. 

Outlook for Employers:  Due to geographic proximity and bilateral working arrangements between Australia and New Zealand, some employers may mistakenly believe the two countries share the same industrial relations environment. This is not the case. Employers with operations in New Zealand should be aware of significant changes pending in the labour relations environment in 2023, with the planned introduction of Fair Pay Agreements.