Rules relating to employment and annual leave in New Zealand.
Employment laws are different for each country. In New Zealand, employees have specific rights when it comes to things like annual leave, minimum pay and dismissal.
Take a look at how some of New Zealand’s workplace laws compare to the UK.
Annual leave in New Zealand
According to Employment New Zealand, all employees become entitled to four weeks’ annual holidays (annual leave) after 12 months of continuous employment in New Zealand.
This means that if you employ someone on a full or part-time basis, you need to keep paying them when they have time off.
In New Zealand, employees are entitled to four weeks of paid annual leave per year, based on the number of hours they work. As shared online, “For employees who work the same hours on the same days each week, the annual holiday entitlement is simple to work out.
Every 12 months (on their anniversary for annual holidays entitlement), the employee gets four of their working weeks of paid annual holidays. For example, the four-week entitlement for an employee who works 3 x 8 hour days per week will be equivalent to 12 paid days (3×4=12), assuming their work pattern doesn’t change.”
Employees who work so intermittently or irregularly that it is too difficult for the employer to provide them with four weeks’ annual holidays (and employees on fixed-term agreements for less than 12 months) may agree to be paid annual holiday pay with their pay.
Here is are some more details about pay and annual leave in New Zealand to be aware of if you’re looking to employ someone in this country:
– If an employee works on a public holiday, they are entitled to take a day off in lieu. There are 11 public holidays in the New Zealand calendar year.
– When entering into an employment agreement, an employer must let the employee know about their entitlements under the Holidays Act 2003
– 10 paid days of sick leave per year are available to employees so they can care for themselves or their dependents.
– Eligible employees can take paid bereavement leave if someone close to them dies, or for a miscarriage or stillbirth.
– Policies apply to leave when it comes to a situation involving family violence.
– Other leave types include garden leave, long service leave, voting leave, jury service, defense forces leave, and leave options for workplace stress or following a natural disaster.
Finally, employees must be paid the right amount at the right time for holidays and leave. Annual holidays and worked public holidays are paid differently from other types of leave and holidays. You’ll find information about calculating holiday pay here, or reach out to your ANZPEO to understand how it all works.
Minimum wage in New Zealand
As well as being aware of annual leave in New Zealand, it’s helpful to know what minimum wage is.
While it does change from year to year, at the time of writing, the minimum wage for adults in New Zealand is $21.20NZD per hour, or $848NZD for a 40 hour work week. This applies from the age of 16, however there is also a starting out/training wage of $16.96 per hour, which applies to:
– 16- and 17-year-old employees who haven’t done six months of continuous employment service with their current employer. After six months with one employer, they are not starting-out workers and must be paid the adult minimum wage
– 18 and 19-year-old employees who have been paid one or more social security benefits for six months or more, and who haven’t completed six months’ continuous employment with an employer since they started being paid a benefit.
Note that The Minimum Wage Act 1983 doesn’t apply to apprentices covered under any other Act.
These rates may seem high when compared to the National Living Wage of £8.91 per hour in the UK, but two New Zealand dollars only works out to around one GBP. The cost of living in New Zealand also reflects the minimum wage.
Dismissal laws in New Zealand
Employing people in New Zealand can be very exciting but you also need to know how to let them go if you need to.
New Zealand is similar to the UK, where an employer must show they have a valid reason for terminating someone’s employment and that they have acted reasonably under the circumstances.
As shared by Employment New Zealand, the reasons why an employer may want to dismiss an employee include:
– serious misconduct
– repeated misconduct
– performance issues
– the end of a trial period
– redundancy
– incompatibility
– incapacity
If you dismiss an employee who was not in a trial period, they have the right to ask you for a written statement of the reasons for dismissal. This request can be made up to 60 days after they find out about the dismissal. Your business must provide the written statement within 14 days of such a request. If you fail to provide this written statement, the employee may consequently be able to raise a grievance after the required 90-day limitation period.
In terms of giving notice, generally speaking, an employer must give the appropriate amount of notice specified in the employment agreement, unless they are dismissing an employee for serious misconduct.
In New Zealand, a dismissal must be for a good reason and be carried out fairly, otherwise the employee may have a personal grievance claim. If your workplace does not have clear guidance about the way an employee conducts themselves, the test asks: ‘what could a fair and reasonable employer have done in the circumstances?’
Understanding employment law in New Zealand
When you employ people who live in New Zealand, it helps to have the support of a professional who knows current employment law inside and out and can ensure you are acting in accordance with current legislation.
Contact ANZPEO to find out more about annual leave in New Zealand and other requirements involved with employing local workers.
