Simpson Grierson has made a submission on the Employment Leave Bill, and we understand we were the only large law firm to do so. 

The Employment Leave Bill (the 'Bill') proposes to replace the Holidays Act 2003 (the 'Act') and establish a new leave framework that is simpler, clearer and more certain, addressing long-standing concerns about complexity, inconsistent interpretation and widespread non-compliance under the current Act.

Central to the reform is a move to an hours-based leave model, supported by clearer categorisation of working hours into standard hours, additional hours and casual hours. Annual leave and sick leave would accrue from the first day of employment, be earned and taken in hours, and be paid at a single hourly rate. The Bill also introduces a Leave Compensation Payment (LCP) of 12.5% on additional and casual hours, paid instead of leave accruing on those hours.

For further background, see our recent article.

Our submission

Our submission is constructive and targeted, drawing on our experience advising employers across a wide range of industries.

Simpson Grierson supports the overall direction and intent of the Bill and considers it a significant step towards addressing the structural issues that have made compliance with the Act difficult in practice. We strongly support a number of core elements, including:

• the shift to an hours-based framework as a default 
  clearer statutory definitions
• improved transparency through enhanced pay statement requirements
• the introduction of a remediation framework to address historic non-compliance
• amendments allowing the transfer of leave entitlements on business restructurings.

Our submission also recommends refinements to improve workability and reduce the risk of unintended consequences. In particular, we highlight the importance of:

• retaining a clear purpose for annual leave (including rest and recreation)
• aligning aspects of the Bill more closely with established case law on casual employment
• providing practical alternatives where notional rosters are not workable
• allowing limited flexibility where hours-based models are impracticable
• ensuring the transitional framework supports certainty and orderly implementation.

What happens next?

The Bill is currently before the Education and Workforce Select Committee, with submissions having closed on 14 April 2026.

The Select Committee's report is due 13 July 2026, after which the Bill will progress through its remaining Parliamentary stages. The majority of the Bill will commence two years after it receives Royal assent. 

Please get in touch with one of experts if you’d like to discuss the potential implications of the Bill for your business.

Special thanks to Enna Pesic for her assistance in writing this article.