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Holidays Act difficulties to be remedied – BusinessNZ

Source: BusinessNZ

BusinessNZ welcomes the final moves towards fixing the Holidays Act, following the Government’s decision to replace it with a new Employment Leave Act next year.
BusinessNZ Chief Executive Katherine Rich says it’s hard to overstate the difficulties that have been caused by the current Holidays Act, with numerous large businesses and government departments becoming non-compliant with the Act over recent years and required to rectify millions of dollars of underpayment.
“Remedying the Act has been a long time coming, and it is positive that the planned new legislation will contain the policy recommendations of BusinessNZ members,” Mrs Rich said.
BusinessNZ has long advocated for an hours-based approach to calculating leave, as this is simpler to apply to non-standard working hours than the current weeks-based system.
Other changes in the new legislation will include leave entitlements required to be proportionate to hours worked, access to leave entitlements from the first day of employment, increased leave compensation payments for casual employees, more flexibility to cash up annual leave, and requirements for employers to provide explicit pay statements.
“Employers and employees are looking forward to simpler, more predictable leave provision in future,” Mrs Rich said.
The BusinessNZ Network including BusinessNZ, EMA, Business Central, Business Canterbury and Business South, represents and provides services to thousands of businesses, small and large, throughout New Zealand.
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Employees are more anxious about their financial wellbeing than their job security

Source: Robert Half

  • 87% of New Zealand workers are concerned about the lagging effects of inflation outpacing salary increases in 2025 
  • Generation X workers (94%) are most worried their salary will not keep up with inflation this year 
  • Other worries Kiwi workers have include wide economic challenges (86%) and job security (72%).

Auckland, 23 September 2025 – Workers are most anxious about their financial wellbeing in 2025, with the lagging effect of inflation and the economy on their jobs weighing heavily on their minds, new independent research by specialised recruiter Robert Half finds.  

New Zealand's GDP is rising1 but research reveals workers are worried about any long-lasting financial effects to their hip pocket. When asked about what concerns they have in 2025, most (87%) employees cited inflation outpacing salary increases, although almost as many (86%) are also concerned about wide economic challenges. Both concerns ranked well ahead of any worries about job security.

Here are the top five concerns for workers in 2025:

  • Inflation outpacing salary increases (87%) 
  • Wide economic challenges (86%) 
  • Job security (72%) 
  • The ability to find work where I want (71%) 
  • The ability to find a new job if needed (56%).

“Kiwi employees are expressing heightened concern about their financial wellbeing this year,” says Ronil Singh, Director at Robert Half. “While cash has always been king in the employee experience, workers are laser-focused on how their pay is translating to their current living circumstances.  

“The data also highlights a significant shift in priorities. Work-life balance and flexibility have been top of mind in recent years and remain important, however, financial stability has taken centre stage. In this climate, it's crucial for employers to revisit their compensation packages and prioritise competitive financial remuneration to address employee concerns about financial security.”  

The research reveals one generation is much more likely to be uneasy about the value of their income in the current economic climate. Almost all (94%) of Generation X employees cited they were concerned about inflation outpacing salary increases, a higher proportion than Millennials (86%), Baby Boomers (86%) and Generation Z (82%).

“Salary worries are not confined to younger workers who generally earn less than their older and more senior counterparts,” Singh says.

“While Gen Z may be slightly less anxious about salary compared to other generations, it's still a top concern for them, indicating a growing awareness of financial realities among younger workers. Employers, therefore, will need to consider what they can offer workers at all levels when undertaking salary reviews,” concludes Singh.

1 Gross domestic product: March 2025 quarter, Stats NZ, August 2025

About the research

The study is developed by Robert Half and was conducted online in November 2024 by an independent research company among 500 full-time office workers in finance, accounting, and IT and technology. Respondents are drawn from a sample of SMEs as well as large private, publicly-listed and public sector organisations across New Zealand. This survey is part of the international workplace survey, a questionnaire about job trends, talent management, and trends in the workplace.

About Robert Half

Robert Half is the global, specialised talent solutions provider that helps employers find their next great hire and jobseekers uncover their next opportunity. Robert Half offers both contract and permanent placement services, and is the parent company of Protiviti, a global consulting firm.  Robert Half New Zealand has an office in Auckland. More information on roberthalf.com/nz.

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Economy – RBNZ opens final phase of Exchange Settlement Account System applications

Source: Reserve Bank of New Zealand – Te Pūtea Matua (RBNZ)
 
23 September 2025 – All interested entities are invited to apply for ESAS access now.

The Reserve Bank of New Zealand – Te Pūtea Matua (RBNZ) has opened the second and final phase of the Exchange Settlement Account System (ESAS) application process and is accepting applications from all entities that meet the new access criteria.

ESAS is New Zealand's principal high-value payments system owned and operated by the RBNZ and is used by banks and other financial organisations to settle transactions in real time. In March 2025 the RBNZ completed a multi-year review of ESAS access and expanded the access criteria to include more non-bank entities.

The ESAS application process has remained open to registered banks throughout the access review. Licensed non-bank deposit takers (NBDTs) in New Zealand have been able to apply since April 2025. Now, all other interested entities can apply.

Financial Market Infrastructures and Settlements Director Steve Gordon says that in general, applications will be assessed in the order in which they're received.  

“We have resources in place to handle applications efficiently. Where an application is less complex and faster to assess, we will do so alongside progressing more complex applications, which may take more time.”

The RBNZ website has been updated with application information for each applicant category. There is a flowchart to help applicants determine which category applies to them, as well as information on prerequisites and requirements separate from the ESAS application process.

Information on how to apply: https://govt.us20.list-manage.com/track/click?u=bd316aa7ee4f5679c56377819&id=3957142364&e=f3c68946f8

The first step for all interested entities is to submit a short Expression of Interest form, which is available on the RBNZ website. Submitters will then be invited to an introductory meeting, after which they can decide if they'd like to apply. There is no fee until an application is formally submitted.

The RBNZ will assess applications using a two-step eligibility approach, considering: if an applicant is engaged in business activities that align with the purpose of ESAS; and if the applicant has an acceptable risk profile, which includes anti-money laundering compliance and meeting prudential, governance and operational requirements.

More information

Exchange Settlement Account System: https://govt.us20.list-manage.com/track/click?u=bd316aa7ee4f5679c56377819&id=e232777ad9&e=f3c68946f8

ESAS access criteria: https://govt.us20.list-manage.com/track/click?u=bd316aa7ee4f5679c56377819&id=f4e5b66abe&e=f3c68946f8

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EMA welcomes long-awaited overhaul of Holidays Act

Source: EMA

The Government’s announcement to repeal and replace the Holidays Act is a long-overdue fix to a system that has caused confusion and cost for both employers and employees, says the Employers and Manufacturers Association (EMA).
Alan McDonald, Head of Advocacy and Strategy at the EMA, says the new Employment Leave Act will bring much-needed clarity and simplicity to leave entitlements.
“Our first submission on the Act dates back to 2017, so it’s great to finally see a government follow through with a system based on simplicity,” he says.
“Employers and employees should be able to more easily understand and apply the rules and that’s a win for everyone. Small to medium-sized businesses should welcome the changes as it brings clear calculations with few other considerations being required.”
The EMA says the shift to an hours-based accrual system for annual and sick leave is a practical and fair solution, particularly for part-time and casual workers. The introduction of pro-rata sick leave more fairly reflects a sick leave entitlement between full-time and casual/part-time workers who all currently get 10 days sick leave regardless of how few hours they work.
The increase in the Leave Compensation Payment (LCP) entitlement helps offset that change for part-timers and better reflects actual hours worked. It also reduces the leave entitlement employers have to carry on their books.
“The current system has led to many millions in remediation payments across both the public and private sectors. This reform will help prevent those liabilities in future,” says McDonald.
“It’s also fairer. Under the current rules, someone working one shift a week could receive the same sick leave entitlement as someone working full-time. That imbalance needed to be addressed.”
The EMA also supports the move to allow leave to be taken in hours rather than full days, and the ability for employees to cash up a greater portion of their annual leave balance. Under the proposed changes, employees would be able to cash out up to 25% of their unused annual leave at each 12-month anniversary of their employment.
McDonald adds that these changes reflect the realities of modern work and give both employers and employees more flexibility.
The EMA notes that while some changes, such as the treatment of parental leave and the LCP for casual workers, may result in minor cost increases for employers, these are balanced by savings from simplified administration and fairer leave calculations.
“Overall, this is cost neutral for most employers, and the time saved from not having to navigate a convoluted system is a major win,” says McDonald.
The EMA also says the 24-month implementation period is pragmatic, allowing businesses and payroll providers time to rewrite software, adjust systems and manage the transition.
“There’s still work to be done on the transition arrangements, particularly for employees with existing leave balances, but this is a strong start,” he says. “We commend the Minister and her team for tackling a long-standing issue and delivering a solution that’s clear and workable.”
Workplace Relations and Safety Minister Brooke van Velden made her announcement on the reform of the Holidays Act at a forum today for EMA members. The event was sponsored by Smartly, the Kiwi-made payroll and people management software that helps thousands of small to medium-sized businesses pay their people simply and compliantly.
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Long awaited Holidays Act changes create winners and losers – NZCTU

Source: NZCTU Te Kauae Kaimahi

The NZCTU Te Kauae Kaimahi has welcomed changes to the Holidays Act that will provide sick, bereavement and family violence leave from day one of employment, remove the unfairness for those returning from parental leave, increase casual loading, and provide for pay statements.

However, some workers lose out in the changes proposed including removing commission and bonuses from holiday pay, reducing sick leave for part timers, and removing leave accruing for workers on ACC.

“The CTU has long advocated for improvements to the Act. We remain deeply concerned about the earnings that have been denied working people due to misapplication of the current Act. While we were successful in getting remedial settlements for many workers, such as health employees at Te Whatu Ora, many people have still missed out,” said NZCTU President Richard Wagstaff. 

“When this review commenced under the last government, businesses and unions agreed that the Holidays Act should be simplified but that reforms should not result in a reduction in worker leave entitlements. 

“The proposed changes do not fully honour that understanding – they will reduce sick leave entitlements for part-time workers (and holiday pay for those on commission). 

“The impacts will disproportionately fall on Māori, Pasifika, women and other vulnerable workers, who are more likely to be in part-time and insecure work.

“It is good that the Act will be simplified but that didn’t need to come at the expense of the hard-won entitlements of working people,” said Wagstaff.

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Defence News – NZDF throws weight into Cook Islands infrastructure work

Source: New Zealand Defence Force (NZDF)

The full team of New Zealand Army engineers and support staff has arrived on the small island of Ma’uke in the Cook Islands, where they will conduct crucial infrastructure upgrades over the next few weeks.

The Royal New Zealand Air Force C-130J Hercules delivered the main body of personnel from 25 Engineer Support Squadron, 2 Engineer Regiment (2ER) on Monday, local time.

A large proportion of Ma’uke’s 240 residents were at the airport to welcome the aircraft and personnel with speeches and songs.

Exercise Tropic Twilight is a long-running annual exercise in various South West Pacific countries. It is funded by New Zealand’s Ministry of Foreign Affairs and Trade and delivered by the New Zealand Defence Force.

This year, more than 30 personnel will carry out maintenance and improvements on Ma’uke’s solar farm, water infrastructure, school and halls.

Serving tradespeople from Australia, Fiji, Tonga and Vanuatu will contribute to work, and they will be backed up by medical and logistics teams.

Troop Commander Lieutenant Jarrod Wilson said the key tasks were repairs and upgrades to the island’s solar-powered water bores, the solar farm and work on Apii Ma’uke – the only school on the island.

“The water and power improvements will be quite far-reaching but even the smaller tasks, such as at the school, will mean things like the students won’t have to walk in the rain to go between classes.”

Tropic Twilight was a good opportunity to get offshore and for the military tradespeople to practice their craft in an expeditionary environment, Lieutenant Wilson said.

“2ER has a long history of this sort of work. Already this year our personnel have deployed around the Pacific, to places such as Papua New Guinea, Fiji and Tonga.

“We are confident that we can get everything done, we’ve got some pretty skilled people here.”

Lieutenant Wilson, who has been part of the advanced party on Ma’uke for a week, said the locals had already been fantastic hosts, and especially generous with food.

The soldiers had also been invited to a rare aka’uru’uru’anga ceremony, where three family members were invested as elders.

“It’s a welcome like I’ve never received before. They are really showing how hospitable they are.”

Mau’ke Mayor Joanne Rongoape Stephens said she was delighted Tropic Twilight was able to help maintain the island’s assets.

Ma’uke’s water supply, which is sourced from an aquifer and reticulated to users, was very important to the island, she said.

 “Our water is pure and we want to maintain that to make sure it keeps going for the next generation.”

She was also thrilled to have so many more people on the island and said it brought back memories.

“The last time I saw the Hercules was in 1985. Seeing it again is amazing. This is a joyful time.”

Tropic Twilight is also the first overseas exercise and a great experience for Sapper Killian Ansell, who has about one month of his four-year electrical apprenticeship to go.

It was an honour and privilege to be on Ma’uke and the locals had been very welcoming, he said.

The solar plant, which started in 2019, will have air conditioning units installed in the battery room to help stop the inverters overheating, allowing the batteries to operate efficiently, Sapper Ansell said.

“Normally we work on residential solar. The solar farm would be a big step up. It will be challenging once we get into it properly.”

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Business Canterbury – Proposed Employment Leave Act the reset businesses were looking for

Source: Business Canterbury

Business Canterbury welcomes the proposed Employment Leave Act which is set to replace the long-criticised Holidays Act – one of the most significant legislative resets for employers in years.
Business Canterbury chief executive Leeann Watson says, “This is the change our business community has been waiting for.”
“In my eight years leading Business Canterbury, no single piece of legislation has caused more frustration, confusion, and cost than the Holidays Act. It’s been a compliance nightmare, riddled with complexity, manual payroll interventions and underpayment risk.
“The Holidays Act has been under formal review since 2018 and Business Canterbury has consistently advocated for reform, so we’re pleased to see real progress finally being made.
“The current Act’s leave formulas have been patched-up and added to over the years, creating a confusing system that fits no one well – instead of formulas that work well for most situations and provide flexibility at the margins – which we think the new Employment Leave Act will achieve.
“The overcomplication and uncertainty in the current Act has led many businesses to overpay leave entitlements just to avoid falling foul of the rules.
Industries like manufacturing, hospitality, and retail, which rely heavily on casual and part-time staff have borne the brunt of the current Act’s shortcomings. The proposed changes including hourly accrual of both annual and sick leave, calculated using a single, consistent method will be clearer, fairer, and more practical for employers and employees.
“While the introduction of a simplified Leave Compensation Payment may increase costs for some, the trade-off is greater certainty, fewer payroll errors, and reduced administrative burden.
“One area of caution is the proposal to allow sick leave to be taken in hourly increments. This could pose operational challenges for sectors like manufacturing and hospitality, where short-notice and short-timeframe cover is difficult to arrange.
“This reform is absolutely a step in the right direction and is one of several changes the Government could make to reduce the friction, cost, and risk associated with hiring.”
Business Canterbury will continue to support its members with expert HR advice as they prepare for the new legislation, which is expected to take effect in late 2028. It will also work closely with businesses during the implementation phase to ensure their systems, policies, and processes are match-fit for day one.
About Business Canterbury
Business Canterbury, formerly Canterbury Employers’ Chamber of Commerce, is the largest business support agency in the South Island and advocates on behalf of its members for an environment more favourable to innovation, productivity and sustainable growth.
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New sick leave reductions will leave retail workers feeling queasy

Source: Workers First Union

Minister Brooke van Velden continues to find fresh ways of making life worse for New Zealand’s workers with a new sick leave policy announced today that will continue the erosion of workers’ rights under this Government and risk our country’s public health response, increase unemployment and underemployment, and disproportionately affect working women and those with long-term health issues, Workers First Union said today.
“The reduction of sick leave entitlements for part-time workers is an idiotic move that proves this Minister has no idea what it’s like to work a real job with lots of public interaction while juggling the difficulty of your children getting sick at school,” said Dennis Maga, Workers First Union General Secretary.
“There is no defensible reason for a person working part-time to have access to less sick leave than someone working full-time,” said Mr Maga. “No matter what hours you work, everyone is prone to getting sick, and especially those with kids who are more likely to be in part-time work.”
“In the retail sector, we’re already hearing that people are being forced to use up annual leave to cover periods of illness beyond their statutory leave entitlements. Those who work customer-facing roles are much more likely to become ill, and it’s in everyone’s interest to ensure they can rest and not risk spreading illness by being forced into work to make ends meet.”
Jess Fuller, a retail worker and member of the Workers First national executive, said the policy would not be warmly received by retail workers, who she said were already struggling to survive on ten days of sick leave.
“I think it’s a disaster of an idea,” said Ms Fuller. “It seems like they just don’t get what it’s like to work a retail job and deal with sick customers when you also have kids in daycare who bring home all kinds of bugs.”
“Having access to decent sick leave is one of the reasons a young mum can go back to the workforce after parental leave. I think this will just increase the number of people forced onto welfare and make more retail workers come to work sick and spread germs to customers.”
“It’s also going to compromise an already burnt-out workforce that’s struggling with low staffing levels and low pay rates in the industry.”
However, Mr Maga said that union members would largely be protected from the effects of this policy due to Collective Agreements that included 10 days of sick leave locked in, which unions would continue to negotiate for all members, whether full- or part-time, despite the Government changing statutory entitlements.
“This is part of a calculated and sustained attack on the working class to benefit rich employers and their pursuit of profit above all else,” said Mr Maga. “There is no other reason to put this policy forward.”
“Whether it’s pay deductions for partial strike actions, changing contractor laws to benefit companies like Uber, or removing protections for unjustified dismissal; this is a ‘trickle up’ Government that reallocates power and wealth from workers to their bosses.”
“It’s like we learned nothing from the Covid pandemic, despite all of the well-wishing and ‘essential heroes’ talk of the time, which clearly meant nothing to the selfish and exploitative ACT Party, who want all labour to be disposable and docile.”
Mr Maga said unions were already planning major protests against this Government’s removal of hard-won workers’ rights, and policies like the one announced today would help to drive turnout and increase union membership among part-time workers.
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Women, casual, & part-time workers worse off with Holidays Act overhaul – PSA

Source: PSA

The Government is prioritising saving money for employers, over the rights of women, casual and part-time workers to fair compensation for being sick and working public holidays.
Workplace Relations Minister Brooke van Velden today announced an overhaul of the Holidays Act 2003 with a new law to come into effect next year.
“The shake-up of rules and entitlements will just give workers yet another reason to cross the Tasman where pay and conditions, particularly around holiday and sick leave, are far more favourable,” said Fleur Fitzsimons, National Secretary for the Public Service Association Te Pūkenga Here Tikanga Mahi.
“We are fast becoming just a labour hire company for Australia.
“Many our members are women who work part-time and will end up having to work longer to accrue sufficient sick leave. They have greater care responsibilities so will be penalised under the changes and will be unable to afford to take as much sick leave.
“Low paid casual workers will have to pay for their own sick leave. This means they will be less able to afford to take leave when they are sick, particularly in a cost-of-living crisis. How is that good for healthy workplaces and for workers to recover and become productive again?
“Casual workers will get a modest loading on their wages to pay for sick leave. The overall loading for annual and sick leave is 12.5%, half that of Australia.
“Similarly, changes to public holiday provisions will disadvantage all workers. The Minister is celebrating the fact that the change will save employers money. Workers get less because the employer no longer must provide a full, alternative day off. Workers will not get the benefit of a full day off to compensate for working on a public holiday.
“The PSA welcomes the changes to parental leave which allow parents to retain leave entitlements and not be disadvantaged by the time taken off.
“But overall, this package of changes continues the erosion of workers’ rights, coming on top of scrapping pay equity claims, axing Fair Pay Agreements, reducing minimum wage increases in real terms, and making it easier for employers to fire workers.
“All this will just make Australia more attractive where workers have higher pay and greater leave entitlements.
“This will further damage the Government’s much vaunted economic growth agenda – we can’t afford to lose more workers to Australia.”
The Public Service Association Te Pūkenga Here Tikanga Mahi is Aotearoa New Zealand's largest trade union, representing and supporting more than 95,000 workers across central government, state-owned enterprises, local councils, health boards and community groups.
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Immigration – NZAMI welcomes changes to resident visa rules – provided English is set at reasonable level

Source: New Zealand Association for Migration and Investment (NZAMI)

The New Zealand Association for Migration and Investment is applauding changes to residency rules, but says they’ll succeed only if the current high bar on English language is set a little lower.

“At present, if skilled migrant workers are unable to get residency, they’re forced to leave the country. So changes announced today address a critical issue for New Zealand business,” NZAMI Deputy Chair Nick Frost says.
 
“It was entirely unsatisfactory that migrant workers who didn’t have a bachelors’ degree or higher had limited ability to meet the requirements for residency.  This was a particular problem for employers of skilled tradespeople in productive sectors such as manufacturing. So well done to the Government for making these changes.”
 
While cautiously optimistic about the changes, one critical problem is the unreasonably high level of English that skilled migrants are required to achieve. At present most resident visa applicants are required to achieve IELTS 6.5, a university-level of English, to be eligible for residence.
 
“This is far too high. If this is not reset, many skilled tradespeople will be lost, to the detriment of industry and economic growth,” Frost says.
 
NZAMI highlighted the wide gap between requirements for investors and skilled migrants. The Government recently announced a new Business Investor resident visa category for which applicants need to achieve IELTS 5.0. These investors will be required to interact in English with their new business’s stakeholders such as customers, employees, unions, and banks.
 
“Immigration policy needs to be consistent. If ILETS 5.0 is a sufficient level of English for a business investor applicant, then it should be sufficient for a tradesperson applicant,” Frost says. “Aligning requirements at IELTS 5.0 is critical to the success of the new skilled migrant pathway.
 
“If the Government continues to require university level English for tradespeople this will disrupt workplaces and communities by forcing valued skilled workers to leave the country,” Frost says.