Employment Bill now ready to proceed to second, third readings in Parliament
New Zealand's Employment Leave Bill will head to second reading in Parliament after receiving unanimous approval from the Education and Workforce Committee.
The committee, after receiving and examining submissions on the proposed legislation, said it "recommends by majority that it be passed."
"We recommend all amendments unanimously," the committee said.
The Employment Leave Bill is the government's move to repeal the Holidays Act 2003, which has drawn criticism for being "complex" and "confusing" among employers.
It introduces a leave framework that distinguishes between different types of working hours: standard, additional, and casual.
Under the proposed legislation, there will be a shift to standard hours-based calculation for annual leave entitlements, and a pro-rated system for sick leave entitlements for part-time workers.
A transition period of two years will be implemented if the bill gets passed to give businesses time to adjust their settings, including updating their payroll systems and reviewing employment contracts.
A 'significant milestone'
In a statement, the Employers and Manufacturers Association of New Zealand (EMA) welcomed the development.
"The return of the Bill from select committee is a significant milestone. While some minor changes have been made during the select committee process, the core reforms remain intact and bring us another step closer to a system that is easier to understand and implement," said Alan McDonald, EMA Head of Advocacy and Strategy.
"That will help lift confidence for both employers and workers."
According to McDonald, the current Holidays Act has been difficult to apply in practice for many businesses, leading to backpay liabilities that ranged up to tens of millions of dollars for some businesses.
Among these employers is Health NZ, which has implemented a repayment plan for thousands of current and former employees following compliance issues with the Holidays Act.
McDonald said the proposed bill addresses the long-standing issues with the Holidays Act that created uncertainty for employers and employees.
"Businesses need rules they can apply with confidence, and employees need to trust their entitlements are right," he said.
The Employment Leave Bill will proceed through its second and third readings in Parliament. The government previously indicated that it wants the bill passed before the election in November.
