The Government’s rewrite of the country’s holiday and sick leave rules has cleared a major hurdle, with a parliamentary committee recommending the Employment Leave Bill be passed. Labour and the Greens say the version now heading back to the House will leave part-time and irregular workers worse off, and they want it stopped before it becomes law.
The Education and Workforce Committee reported the bill back to Parliament by majority, according to RNZ. That clears the way for a second reading, the next debate a bill must survive before it can be voted into law. The committee received submissions from about 660 groups and individuals, a sign of how much interest the plan has drawn from unions, employers and ordinary workers trying to work out whether they will come out ahead.
The bill replaces the Holidays Act 2003, a law that has frustrated payroll teams and employees for more than two decades. Successive governments have grappled with it because its formulas for calculating holiday pay proved so hard to apply that thousands of workers, including many in the public sector, were underpaid over the years and had to be paid back. The stated aim of the new bill is to make entitlements simpler and clearer so that people are paid the right amount without years of confusion and remediation.
The Minister for Workplace Relations and Safety, Brooke van Velden, has framed the change as a fix that helps both sides of the pay slip. She said the bill passing “will mean businesses and workers having more confidence that they’ll pay and be paid correctly for annual and sick leave”, and described the outcome as “a win for both workers and businesses”. The Government first introduced the plan as a long-awaited replacement for the Holidays Act, and it cleared its first reading before going to the committee for scrutiny.
The fight is over how the new law treats hours that fall outside a worker’s set roster. The bill introduces a concept of standard hours, and ties annual leave and sick leave to those standard hours rather than to all the hours a person actually works. Labour argues that means two people can do the same job for the same employer and end up with different leave, depending on how their hours are classified on paper. In its minority view, the party said the bill “promotes insecure work”, that “it creates less predictable access to leave, and reduces entitlements at each opportunity”, and that it had been “precision engineered” to target the workers with the least bargaining power.
Labour also drew a line under sick leave in particular. The party said “sick leave is a health and well-being entitlement, and it should not be diluted for workers whose hours are irregular, variable, or additional to standard hours”. The concern is that a shift worker who picks up extra hours during a busy stretch would not see those hours count towards the leave they can bank, even though the work is real and the pay is real.
The Greens pressed a similar case but focused on who carries the cost. The party said the change would fall hardest on people already stretched, arguing that “those who have less to spare are the ones taking a pay cut under this bill”. It also warned that pro-rating sick leave for part-time staff would land unevenly, because women are more likely than men to work part-time, and so would absorb more of the reduction. The party said the effect would flow through to young people, MΔori, Pasifika and migrant workers who are over-represented in variable and part-time roles.
The Government’s answer is that clarity is the point. Officials have long argued that the old law was so complex that neither employers nor staff could be sure what was owed, and that a simpler set of rules is fairer than a generous formula nobody can calculate correctly. Van Velden’s position is that certainty and correct payment are worth more to workers than a system that promised more on paper but delivered errors and disputes in practice. The full text of the bill and its progress can be followed on the Parliament website, and the Government has published a plain-language summary through Employment New Zealand.
What happens next is a numbers game in the House. With the bill reported back by majority, the coalition has the votes it needs to move it through a second reading, then a committee of the whole House stage where amendments can still be moved, and a third and final reading. Labour and the Greens can slow the bill and force debate, but on current numbers they cannot block it, so their pitch is aimed as much at voters as at the chamber.
That makes leave law one of the sharper dividing lines heading into the election. The Government is selling simpler rules and reliable pay. The Opposition is warning of quiet cuts to sick days and holiday pay for the people least able to absorb them. Which of those messages lands may depend less on the fine print of standard hours and more on whether workers feel their own entitlements shrinking. If you want to see where the parties stand on this and other issues before you vote, you can compare them with our voting tool.
Do you work variable or part-time hours, and would this bill change what you can bank in leave? Have your say in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job π
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