New minimum sick leave entitlement

As you will be aware, the Government has passed the Holidays (Increasing Sick Leave) Amendment Bill to increase the minimum employee sick leave entitlement. With the change being imminent, now is a good time to become informed about the change and some of the finer points. It also seems timely to remind ourselves of some of the other aspects of sick leave.

What is the change, and when does it start?

Most employees who have worked for an employer for six months or over (current continuous employment) are entitled to sick leave if they, or a dependent, are sick or injured. Currently, employees are entitled to 5 days of sick leave per year; however, from 24 July 2021 this will increase to 10 days per year. The entitlement to sick leave includes part time employees – irrespective of the hours worked.

Will all my employees get 10 days sick leave when it starts on 24 July?No. Existing employees will get the extra five days when they reach their next entitlement date – either after reaching 6 months’ employment or on their sick leave entitlement anniversary (12 months after they were last entitled to sick leave).

New employees i.e., those commencing employment with you from 24 July 2021 onwards will be entitled to 10 days sick leave from their entitlement date (i.e. six months from commencing employment with you). After the initial entitlement arises on reaching 6 months’ continuous employment, a further 10 days’ sick leave entitlement will arise for each subsequent 12-month period of continuous employment.

Are casual employees entitled to sick leave, and the increase to 10 days?

It depends on their work patterns. An employee is entitled to sick leave after they have completed 6 months’ current continuous employment with the employer or, if that does not apply, after the employee has over a period of 6 months worked for the employer for at least an average of 10 hours a week during that period and not less than 1 hour in every week or 40 hours in every month during that period.

My team already gets 10 days sick leave per year – will their entitlement change?

No. Employees who already get 10 or more sick days a year will not be affected by this change.

Will the number of sick leave days my employees can accumulate increase?

No. The maximum amount of unused sick leave that an employee can be entitled to will remain 20 days.

Can I ask my employee for proof of injury or illness?

Yes. You can require proof of illness or injury if the employee is away for three consecutive days. You may also require proof when the employee is away for less than three consecutive calendar days; in this case you must inform the employee as soon as possible of the requirement to provide a medical certificate and you must pay for the cost of the certificate.

If a team member doesn’t seem ‘right’ to work, can I require them to get a medical check-up?

While you cannot force an employee to have a medical examination, if an employer has good reason to believe that an employee is impaired (unwell or harmed) for any reason (whether from exposure to workplace hazards or other causes) then they may suspend an employee, subject to the usual legal requirements. It is important that you follow a good process in any situation like this. Therefore, we recommend that you seek professional HR advice from ConsultingHQ before taking any action if you are faced with this situation.

If an employee is required to provide proof of illness or injury in support of sick leave you may withhold payment for that sick leave until the required proof is provided. Proof of injury or illness includes a medical certificate.

Reminder about the Covid-19 Leave Support Scheme

Hopefully the need for this type of support is in the past, but it is good to remember that in case it is needed again the COVID-19 Leave Support Scheme is available for employers, including self-employed people, to help pay their employees who need to self-isolate and can’t work from home.

This means your workers can’t come into work because they are in one of the affected groups and have been told to self-isolate and can’t work from home.

To find out more, visit the www.workandincome.govt.nz/covid-19/leave-support-scheme/index.html.

In addition, the Government have a Short-Term Absence Payment which is available for employers to help pay their employees who cannot work from home while they wait for a Covid-19 test result. Further details are also on the Work and Income website.

What do I need to do to be ready for the change to 10 days sick leave?

You need to update your employment agreement template so that people commencing with you from 24 July onwards have the correct sick leave entitlement in their employment agreement. You will also need to ensure other documentation is updated e.g. policy and procedure manuals, employee intranet etc. Ensure your payroll provider/system has had the necessary updates to cope with the change in entitlement which will occur over a period of time with the existing team.

Working out sick leave entitlements can be complicated. If you have any queries about the law changes and need your employment documentation updated, or you just have a general query, please do not hesitate to contact ConsultingHQ for advice.

Book a complimentary 15 minute consultation now with our Director, Tanya Gray.