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Holidays Act Compliance

More than 100,000 health workers will have their holiday pay calculations reviewed going back to 2010 with an undertaking that any shortfall will be refunded. Investigations undertaken by the Labour Inspectorate of the Ministry of Business Innovation & Employment (MBIE) identified widespread issues for a number of employers that their payroll systems were not complying with the requirements of the Holidays Act. This meant that many employees were not receiving their correct leave entitlements.

DHBs, the New Zealand Blood Service (NZBS), the New Zealand Council of Trade Unions (CTU), Health unions and the Labour Inspectorate have been working together to develop an agreed national audit process. The Holidays Act is complicated, outdated and has caused significant problems for employers and workers alike.For the workforce the Holidays Act presents complexities because of their wide ranging shift patterns and rosters covering a 24 hour a day, seven day week service. For the employers our payroll systems are also inadequate, and the result has been miscalculation of entitlements and noncompliance; this process is designed to address that.A joint approach to resolving this issue was agreed with MBIE’s Labour Inspectorate which includes:

• An agreed baseline on how the Holidays Act applies to health sector employees;

• A framework on how DHBs will assess and rectify non-compliance; and

• A memorandum of understanding that details the agreement between the CTU, unions, DHBs and the Labour Inspectorate.

The 20 DHBs and the NZBS will be grouped into tranches for the review, beginning with the Auckland and Northland DHBs which are already underway. All reviews will be underway by April 2020 and it’s estimated that it will take between 12 and 18 months for each DHB to work through a process to review, rectify and remediate noncompliance issues.

DHBs and the Health unions will also be communicating with DHB employees as and when their reviews get underway, with details of how they can take part and be represented. Waikato DHB’s review is expected to get underway in November.