As Christmas is near, it’s time to set the record straight on some of the most commonly misunderstood aspects of employment law that apply to the festive season.
We’ve made it easy for both employees or employers with a five-point quick guide. It is focused on minimum legal employment rights. However, the parties can agree to rights above the minimums and these should be written into an employment agreement.
- Is closing down a workplace for a determined period lawful? (Yes or No)
Employers may close down a workplace if the process is managed lawfully, so it’s a Yes.
An employer may have a regular closedown once a year and this is common over the Christmas/New Year period. Employees, who are entitled to annual holidays at the time of a closedown, are required to take annual holidays or other leave arrangements during the closedown. The closedown can apply to part or all of the business, but employees must be given at least 14 days’ notice.
Whether employees should be paid depends on a number of factors, including whether they have built up enough annual holidays, or otherwise if agreed, they can take annual holidays in advance or unpaid leave.
- Should employees working a public holiday always get time and a half, plus an alternative day off? (Yes or No)
Employees working on a public holiday should always be paid time and a half. However, they only get an alternative holiday (a paid ‘day in lieu’) if the public holiday they worked was a day that they normally worked, (ie, an otherwise working day for them), unless the employee only works on public holidays. Therefore, all employees working public holidays aren’t entitled to an alternative day off, so it’s a No.
When a public holiday falls on a Saturday or Sunday, and this is a day the employee does not normally work, then an employee’s public holiday might be moved to the following Monday (or in some cases Tuesday).
For example, an employee who normally works weekends is required to work on Christmas Day this year, Wednesday 25 December. This is not a normal working day for this particular worker, so they don’t get an alternative holiday, but still get paid time and a half. However, if the Wednesday was their normal working day, they would also get an alternative holiday.
- Can employers refuse a request when their employees ask to take their annual holidays? (Yes or No)
Employers and employees should try to work out annual holiday arrangements that are acceptable for both parties.
For example, an employee might request to take two of their four weeks annual holidays over the Christmas break for an extended family holiday. Employees may need to take holidays for important and legitimate personal, family and community responsibilities. Employers must give their employees the opportunity to take at least two of the four weeks’ annual holidays continuously. This rule is to ensure staff are given an extended opportunity for rest and recreation at least once a year. However, an employer also has the right to run their business as well eg to ensure that they have enough staff to continue to operate. The key point here is that the employer must have fair and reasonable grounds to refuse a request to take annual holidays at the requested time.
On those occasions when both parties can’t reach agreement about the timing of employees’ annual holidays, then the employer can decide the dates, providing they are being fair and reasonable. However, the employee must be given at least 14 days’ notice to take annual holidays on those specified dates. So it is a Yes.
- Do employers have to provide their employees with annual holidays (annual leave) in advance? (Yes or No)
Employees don’t have a minimum legal right to take annual holidays in advance before they complete one year of work. If an employer provides this, it is at their discretion, so it is a No.
All employees become entitled to at least four weeks’ annual holidays after 12 months of continuous employment.
However, it is also common for some employers to allow their staff to take annual holidays in advance, even when they haven’t “accrued” enough days. “Accrued” is like a balance that staff have accumulated since they started working for a business. However, there is no legal requirement for an employer to provide annual holidays in advance.
- Can employees cash-up all their annual holidays during their employment? (Yes or No)
Employees can ask to be paid out up to one week’s worth of annual holidays per year for each entitlement year, but the employer can say no to the request, so it’s a No. If the employer agrees, employees must not cash-up more than one week’s worth of annual holidays per year for each four weeks holiday.
For example, an employee might want extra money for Christmas gifts and expenses and want to cash-up some of their annual holidays’ balance. The employee must have completed 12 months’ employment and make the request in writing. The employer must reply in writing and doesn’t have to give a reason for their decision.
An employer can also opt out of having to consider such cash-up requests by stating this into a workplace policy or employment contract.
Also, an employer cannot force an employee to cash up a portion of their annual holidays, if the employer has not been given a written request from the employee. In this case, the employee can keep both the cash up money and still take the portion of annual holidays cashed up as paid holidays. The employer may also face a penalty.
How did you do?
If you didn’t get all the answers right, we hope you learnt some useful knowledge.
We focussed on minimum employment rights and responsibilities. Also, employers and employees should always treat each other in “good faith” (with respect and open communication). Acting positively towards each other, with advance notice and a flexible approach, means the parties can work out win-win arrangements.
For more information visit the Ministry of Business Innovation and Employment, Employment New Zealand website: www.employment.govt.nz.
Also, you can get free online learning via www.employment.elearning.ac.nz that has the popular “An Introduction to Your Employment Rights” module.
Employment New Zealand hopes this guide helps all employers and employees to have better working relationships. And of course we wish you a Merry Christmas and Happy New Year!