Holidays Act compliance & remediation

What you need to know

The Holidays Act Compliance Team at Nelson Marlborough was formed to ensure employees are paid correctly when they take leave as per the Holidays Act 2003. Moving to Te Whatu Ora has not changed this, and the Nelson Marlborough will continue to run the project for our current and former employees.

What is Holidays Act compliance and remediation?

The Holidays Act 2003 covers pay and entitlements surrounding all types of leave and public holidays for employees in New Zealand. While it’s generally easy to apply the Act to employees working standard hours, it has proven to be more complicated applying it to employees on shift work, variable days and hours, or with flexible work patterns. This has resulted in non-compliance – essentially employers unintentionally underpaying or overpaying staff.

A memorandum of understanding (MOU) between DHBs, the health Unions, and the Ministry for Business, Innovation and Employment (MBIE), has been developed and signed. Under this MOU, we are tasked with undertaking the review, rectification and remediation related to the end-to-end payroll system and associated processes.

What is the process?

Nelson Marlborough and all other districts are using the ‘Framework for Local DHB Holidays Act Review’ document provided by the national programme to guide the review. Unions are represented in our Steering Group and Working Group to oversee the process.

There are three key phases:

1. Review

The Review Phase involves an external auditor testing the payroll systems against the baseline Interpretation agreed by the DHBs and unions to identify the extent of non-compliance. The Review Phase has been completed.

2. Rectification

Rectification is where the focus is placed on fixing the identified non-compliance issues and implementing appropriate processes to ensure all future payments comply with the Holidays Act. This is being worked on now.

3. Remediation

The Remediation phase is where the calculation and payment of any amounts owing to current and former employees arising from any identified non-compliance will occur. The timing of this coincides with implementing the rectified system.

How many employees might be affected?

We will review holiday payments for any current or previous employees since 01 May 2010. Initial figures suggest there will be around 8300 employees reviewed.

What has been agreed upon between districts and the unions?

We have agreed to proactively make the appropriate remediation payments to both current and former employees whose holiday pay was calculated incorrectly from 01 May 2010, and to ensure all future payments are calculated and paid correctly in accordance with the Act.

What about current employees?

Current employees don't need to do anything in relation to their employment here. If you are identified as being owed money, we will already have your account details and you will receive a statement outlining the adjustments once we have calculated them.

As part of the Remediation Phase, we will ensure your holiday pay is correct moving forward. Please be aware that any remediation payment may impact tax brackets, allowances, student loans, tax payments, superannuation etc.

What about former employees?

If you are a former employee and worked any time between 01 May 2010 and the present time, you will be able to register your contact details via an established national website to ensure your most up-to-date contact information is captured.

The national website will be well-publicised, and a link placed on this page. Registering your details will make it easier for us to contact you should you be eligible for reimbursement.

If you are a current employee, you will not need to register your details on this website. However, if you have previously worked for another district (DHB) during this period you will need to register those details via the national website.

National consistency

Completing the project is reliant on national decisions on how compliance will be implemented. A joint process with districts and unions has continued to work through all the compliance issues and this is mostly completed.

Where is our process up to?

The compliance team is now working through the systems and process changes that need to be made for rectification. Until we have a fully rectified pay system, we cannot process any remediation payments.

How can I keep informed about the progress of the project?

Further communications will be led through ELT as part of the change process.

Union members can also contact their respective organiser/advocate with questions or concerns.

As an employer, Te Whatu Ora - Health New Zealand, Nelson Marlborough is required to ensure its employees are paid appropriately when they take leave as per the Holidays Act 2003.