Many of the problems with the Holidays Act 2003 have been because MBIE has not provided support or leadership to employers or the payroll sector. Having their head buried in sand has done little to resolve the issues with the act. MBIE has stated they do not see their role as needing to provide their interpretation of the act but at the same time they can prosecute an employer when the believe they are wrong without providing any support or information on what the employer has to do to get it right.
NZPPA has made a number of OIA requests escalating them when MBIE refused to provideinformation requested as complaints to the Ombudsman. We are slowing getting information being provided and will share everything so all can use it.
One of the issues with the Holidays Act is when an employee does not have a clearly defined week.
Please see below an extract from the training material used to train MBIE staff (Labour Inspectors)
on how MBIE sees a “Week” can be determined when not clearly defined.
Extract from MBIE Training material:
It is not common for Inspectors to find agreements between employer and employee as to what constitutes a week and so it often falls to Inspectors to make calls on this when checking performance against the Holidays Act. Fortunately in the vast majority of cases this is straight forward as there is a reasonably standard number of days a week. Sometimes there is a pattern from week to week. For example one week is 5 days and the second is 6. Most Inspectors would simply average out such days and arrive at 5.5 days for a week.
Sometimes there are repeating patterns of work but they do not fit within weeks (e.g. 4 days on – 2 days off – 6 days on 3 – days off). This is also not too challenging with most Inspectors using the formula below to approximate a working week:
7 calendar days x days worked in the cycle
the number of days in the cycle
if applied to the example given earlier this comes to:
7 (calendar days) x 10 (days worked in the cycle)
15 (number of days in the cycle)
= 4.66 days per week
People also change their working weeks. For example, an employee works 2 days a week and then increases their hours to 4 days a week. In theory the employee and employer should have agreed how to deal with this in terms of what is a week. In the absence of agreement in such circumstances, Inspectors tend to base a week on the working week at the time the leave was taken though there is no direction in the Act to suggest this is the correct approach. It could easily be argued that it should be based on what a week was when the leave entitlement crystallised at the end of the entitlement year. An argument could also be made for it to be based on a system of accrued hours so effectively averaging the two different working weeks.
In rare occasions the hours and days of work are all over the place with no rhyme or reason to them.
In such cases there is not much that can be done except to use an accrual system such 4/52 of an hour for every hour worked. Again there is no direction to do this in the legislation but it is a practical solution to a rare problem.