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Long overdue Holidays Act taskforce brings hope for businesses

May 29, 2018


Partners Phillipa Muir

Holidays Act Employment (inc Employment Relations Amendment Bill) Government reform and public policy

Law firm Simpson Grierson welcomes the Workplace Relations and Safety Minister’s “long overdue” announcement today of a new taskforce to recommend changes to the Holidays Act 2003.

Simpson Grierson Partner Phillipa Muir says the taskforce and an overhaul of the Holidays Act is something that the law firm has been lobbying for and urging the Government to tackle for years.

“There has been an urgent need for years to fix this overly complex and anachronistic piece of legislation,” says Muir.

“Employers have continually struggled to comprehend and apply the Holidays Act in its current form, to the potential detriment of both employers and employees. The overwhelming majority of our employer clients continue to rate this as their number one workplace issue for reform.”

Simpson Grierson’s survey of employers late last year found that 88 per cent of employers wanted the Government to change and simplify the Holidays Act.

Muir says this is unsurprising due both to the complex calculations the Act requires – involving up to seven different calculations to work out employee holiday pay – and considering that the legislation was originally drafted when the norm was still a 9-to-5 Monday-to-Friday work week.

"I believe we should move to one formula for all types of leave,” says Muir. “It'll make it much simpler and help to avoid the unintended consequences for employees where employers are getting it wrong for no fault their own."

While a previous Government attempt in 2009 to address the issues in the Holidays Act failed to reach a consensus, Muir is optimistic that Minister Lees-Galloway’s ‘tripartite taskforce’ is committed to deliver the change required.

“Achieving reform that provides certainty to both employers and employees will involve a meeting of minds between the unions’ side and employers’ side and direction from the government,” says Muir.

“The number of high-profile and costly holiday pay issues that have arisen in recent years has only heightened the urgency for all sides to work together on simplifying this important piece of legislation.”