Sometimes a situation arises where an employee has built up a large annual leave balance.  Not only might this be a potential financial liability for an employer, given annual leave needs to be paid out at the end of employment, but health and safety concerns might arise, such as is the employee having adequate breaks from work?  An employee might conversely want to use their leave but find that their employer will not agree.  What can employers and employees do in this situation?

Annual leave rights and obligations are covered by the Holidays Act 2003.  The Act provides several ways in which accumulated annual leave can be addressed.

When can an employee take leave?

The Holidays Act 2003 states that “An employer must allow an employee to take annual holidays within 12 months after the date on which the employee’s entitlement to the holidays arose”. This does not create a positive obligation on an employer to ensure an employee actually takes the leave but it does mean that an employer must make it possible for an employee to be able to take leave within the 12 months it falls due.  Failure to do so could, for example, open up employers to action by the Labour Inspectorate; the imposition of a financial penalty; and/or a personal grievance claim.

Separately, employers can ask an employee to use their annual leave which has fallen due (e.g. within 12 months of employment starting and every 12 months after) and, if agreement is not reached, direct the employee to use their leave on no less than 14 days’ notice. However, employers cannot direct an employee to take annual leave in advance (e.g. annual leave which has not yet fallen due).

In trying to reach agreement, consultation and negotiation should be genuine.  While the following case was based on the employee’s employment agreement, the wording was not dissimilar to the requirements of the Holidays Act.

In the case, the agreement provided that timing of leave was to be agreed between the parties but, where agreement was not reached, was at the employer’s discretion. The employee, a urologist, accrued an abundance of annual leave over his employment. Following the employer locating a locum, they discussed with the employee the possibility of him taking leave for six months, commencing the following month. The employee was not keen on this idea due to timing and, after some discussion, the employer fixed the leave to be taken over the following five months. A claim for unjustifiable disadvantage was made out in the (then) Employment Tribunal because the employer failed to meet their obligation to consult and negotiate.  This was because they had not allowed the employee input into the timing of the locum’s visit and, in the circumstances, they had not genuinely consulting with the employee when fixing the timing of the leave.

Further in terms of agreement, if an employee suggests a proposal for when they will use their leave, such as one week now, one week in a month, and one week a month later, the employer must not unreasonably withhold consent.  In other words, if an employer declines, they must have reasonable grounds to do so.  In one case, an employer was found to be in breach of this where they declined consent to an employee who asked to take leave in 3 months’ time because the employer did not yet have an employee to cover the employee requesting leave.  In that case, the employee had been employed for over 12 months and had taken no leave to that point.  While this was not stated expressly, the Authority appeared to consider that the employer’s lack of staff cover was, in this case, not sufficient to reasonably decline the leave request.  However, in other circumstances, possible grounds could include when an employer cannot reorganise work among existing staff, the employer cannot recruit additional staff, or there is a planned structural change.

Finally  if an employee wants a longer break at one time, employers must allow employees to take at least 2 weeks’ leave as a continuous block in every 12 month period.

Paying out leave in cash

An employee can ask for one week’s annual leave to be cashed up but an employer cannot force an employee to do so.  Any request by an employee can also only occur once within one 12-month period. The employer does not have to agree to this, so long as they have considered it within a reasonable time and advised the employee of their decision in writing. There is no obligation on employers to provide a reason for their decision.

Can annual leave expire?

Annual leave entitlements do not expire if they are not taken.  The Holidays Act provides that an employee’s entitlement to annual holidays remains in force until either the employee has taken the entitlement as paid holidays or the leave has been paid out, such as on termination of employment. Thus, even if annual holidays are not taken within a 12 month period, employees are still entitled to the leave. This is despite what an employment agreement states; employers cannot contract out of the Holidays Act.

After employment ends

Where the employee’s employment ends, the employer will have to pay that employee:

  • 8% of their gross earnings since their last entitlement date, less any amount paid for holidays taken in advance; AND
  • The value of any annual holidays which have already fallen due but not taken, paid at the rate of the greater of ordinary weekly pay as at the date of the end of the employee’s employment or average weekly earnings during the 12 months immediately before the end of the last pay period before the end of the employee’s employment.

Why taking leave is important

Both employers and employees have a duty to take steps to protect employee(s) health and safety.  Taking breaks away from the workplace is one way to help safeguard employees against the effects of overwork, as well as to reduce the likelihood of fatigue related mistakes or incidences.  Employers and employees should therefore work together to make sure that regular breaks are taken, utilising some or all of the above mechanisms.

This article is not a substitute for legal advice and you should consult your lawyer about your specific situation. Please feel free to contact us at Parry Field Lawyers:

When an employer is considering making an employee(s) redundant, there are three key steps they need to get right:

  1. Following the terms of the employee’s employment or collective agreement and, in particular, what it says about making employees redundant.
  2. Making sure that the reasons for the redundancy are “genuine”, rather than, for example, simply a cover to remove an underperforming employee. In other words, being able to demonstrate that any redundancy is genuinely justified on the basis of valid commercial grounds.
  3. Following a fair and reasonable process.

At the centre of this is being clear from the start about why a redundancy may be needed in the first place.

This may seem obvious but not infrequently we see employers coming unstuck at this point.  They are unclear and/or imprecise, sometimes in their own minds but, more frequently, when communicating with the employee, about why exactly they are proposing to remove a role and what evidence they are relying on to back up that proposal.

The law is clear that it is not enough for an employer to say or show that it genuinely believes a redundancy is required.  While an employer is entitled to make their business more efficient, whether or not the business is in financial dire straits or not, an employer must still:

  1. Be able to clearly advise the employee, and with sufficient detail, about what the relevant issues are, giving rise to a possible redundancy;
  2. Provide the employee with accurate evidence substantiating those issues; and
  3. Give employees a real opportunity to be able to comment on those issues and, in particular, put forward alternative proposals if they are able to.

This means that, in general, it is not enough to simply advise the employee in broad, imprecise terms, as to why a redundancy is proposed.  For example, to simply say that the employer has reviewed the business and redundancies are necessary to “streamline” the business, improve efficiencies or to save costs.

While those – making a business more efficient or saving costs – can be valid reasons for a restructure, the employee is entitled to know more on the how and why.  The courts have been clear that:

“there must be made available to the other party sufficient information to enable it to be adequately informed so as to be able to make intelligent and useful responses” or, put another way, there must be “the provision of sufficient information to fully appreciate the proposal being made and the consequences of it and, secondly, an opportunity to consider that information and, thirdly, a real opportunity to have input into the process before a final decision is made.”

Consequently, in the example given, this may include providing information on:

  • What the employer’s review of the business showed? What issues were revealed?  For example, “over the past 6 months, we have experienced an X% downturn in work in these areas.  This is as a result of the loss of the X and Y contracts, which, on re-application, were re-tendered to Z Group.  The effect of this on the company is that revenue has dropped over the same period by an average of by X% and productivity by X%.  We are anticipating that these figures will continue over the next Y months because ….” 
  • The evidence the employer has that demonstrate those issues, such as current and projected revenue or productivity figures?
  • What does the old and new employee structure look like under the restructuring proposal? For example, are other roles proposed to be removed? Who will undertake the employee’s existing role (if the duties under it are still required by the employer)?
  • How would removing the employee’s role help address the issues identified by the employer?
  • Have any options, other than removing the employee’s role, already been considered?
  • Could the employee be redeployed?

In our experience, where employers get this right, it reduces an employee’s disquiet and, consequently, the likelihood of an employment relationship issue arising.  It also helps employers make better decisions, more accurately identifying what changes are actually needed and how best to implement them.

Finally, there are some limits on the information employers are required to provide employees.  For example, information which would breach the Privacy Act 2020 or commercially sensitive material, the disclosure of which would unreasonably prejudice the employer’s commercial position.

In these cases, certain information may need to be redacted, before being provided to the employee or, in some circumstances, there may be grounds to withhold particular information altogether.  We recommend however that employer gets advice before doing so.  It is not enough for an employer to simply say they believe withholding information is necessary.  That decision can also be scrutinised and will need to “stack up”.

This article is not a substitute for legal advice, and you should contact your lawyer about your specific situation. We would be happy to assist you with your employment matters.

In June 2012 we posted an article highlighting the importance of employers, who want to rely on a 90 day trial period, ensuring that all new employees sign their employment agreement containing the trial period before their first day of work. The Employment Court has now set out a further requirement, namely that trial periods in employment agreements must be provided to prospective employees at the same time as, and as part of, making an offer of employment to the proposed employee in order for an employer to rely on them.

In Blackmore v Honick, the employee was offered employment in writing and accepted such in writing (by email). The written offer set out a number of the terms of employment and stated that a written contract, containing those terms, would be provided to the employee after he accepted the position. No mention was made of a trial period. He subsequently resigned from his previous employment and commenced work with the employer. At that time (shortly after he started work) he was presented with an employment agreement containing the trial period which he signed. Some time later but before the end of the 90 day trial period, the employer terminated his employment in reliance on the trial period.

The Employment Court subsequently held the employer could not rely on the trial period when dismissing the employee as the employee was already an employee when he signed the agreement.* The Court stated that, in the context of a trial period, an employment relationship begins as soon as an employee is offered and accepts employment. As the employee had accepted the job offer prior to signing the employment agreement, he was not bound by the trial period contained in it.

The Court held further that, in general, in order for employees to be regarded as not having been previously employed by an employer, the trial period must be agreed in writing before the employee begins work. More particularly, trial periods in employment agreements must be provided to prospective employees at the same time as, and as part of, making an offer of employment to the proposed employee in order for an employer to rely on them.

The further moral of the story therefore is if you, as an employer, want to safeguard your ability to rely on a 90 day trial period, make sure that any offer of employment to a new employee is accompanied by something in writing (preferably the employment agreement) setting out the inclusion in the offer of a 90 day trial period, and its scope/terms.

This article is not a substitute for legal advice and you should consult your lawyer about your specific situation. Please feel free to contact us at Parry Field Lawyers:

* The Employment Relations Act provides that a 90 day trial period can only apply in respect to new employees.

The law around 90 day trial periods continues to develop. We have previously posted articles on the importance of having an employee sign their employment agreement before their first day of work and also agreeing to a trial period before accepting an actual offer of employment.

A recent case – Allan v Mobile Shop Limited & Anor [[2012] NZERA Auckland 430; 30/11/2012; R Larmer] – has now confirmed the importance of also ensuring a prospective employee is given a real and reasonable opportunity to obtain legal advice on their employment agreement, including the trial period, prior to signing the agreement. If an employer does not, they may not be able to rely on the trial period, even if they have met all other pre-requisites.

The Facts

In the case, the employee claimed he was unjustifiably dismissed from his employment. One of the employer’s arguments was that the employee was prevented from raising a personal grievance due to the 90 day trial period in his employment agreement.

The employee was offered employment but it was not until approximately 2 week’s later that an employment agreement was signed. He then signed the agreement within 20 minutes of receiving it from the employer and was not advised of his right to seek independent legal advice. He started work the next day. His employment was later terminated on the grounds of poor performance.

The Outcome

The Employment Relations Authority considered that the dismissal was procedurally and substantively unjustified for a variety of reasons. Despite there being a trial period in the employment agreement that complied with the Employment Relations Act 2000, the Authority decided that the lack of time given to the employee to seek independent legal advice on the terms of the agreement prior to signing it meant that the trial period clause should be struck out of the agreement.

The Authority confirmed that there is an obligation on an employer to provide a reasonable opportunity for an employee to take independent advice, even if the employee freely wants to sign the agreement immediately and without taking advice. In addition, starting work the day after signing an agreement suggested that there had not been a “real” opportunity to take independent advice/negotiate any terms.

The lessons to take away

If you want to protect your right to rely on a 90 day trial period when employing a new employee make sure:

• You give them a copy of their employment agreement containing the trial period at the time they are offered employment.

• They have a sufficient amount of time after that to take independent advice on the agreement/negotiate its terms with you, if they so choose. In other words, make sure the agreement is not given to them just before they are due to start work!

• They don’t just sign the agreement immediately, even if they want to. You may need to insist that they take the agreement away, unsigned, to be returned at a later date.

This article is not a substitute for legal advice and you should consult your lawyer about your specific situation. Please feel free to contact us at Parry Field Lawyers:

Stress claims at work arise in a variety of situations. Read more

Are you an employee looking to take a period of parental leave or, alternatively, an employer who has an employee intending to do so? You may be wondering what your entitlement or obligations are.

In this article we consider an employer’s obligation to keep open an employee’s usual job until the end of the employee’s parental leave unless certain circumstances apply.

The Law

Under section 41 of the Parental Leave and Employment Protection Act 1987 (‘the Act’), when an employee takes a period of parental leave in excess of 4 weeks, the Employer is presumed to be able to keep open the employee’s usual job until the end of the employee’s parental leave.

This is unless the employer “proves” that the employee’s position cannot be kept open because:

  • a temporary replacement is not reasonably practicable due to the “key position” occupied by the employee within the employer’s enterprise; or
  • of the occurrence of a redundancy situation.

This article considers what is meant by a “key position” and not “reasonably practicable”.

Key Position

The Act provides that, in determining whether a position is “key” or not, regard may be had to, amongst other things:

  • the size of the employer’s enterprise; and
  • the training period or skills required in the job.

Cases which have considered this section provide further clarification:

1. The words unless the employer “proves” that the employee’s position cannot be kept open places a heavy onus on the employer (to establish this fact).

2. The rights of the employee are intended by the Act to outweigh the rights of the employer unless the employer can meet the required onus.

3. A key position is one which is of such a crucial and pivotal nature to the efficient operation of the   employer’s business that it is required to be filled on a permanent basis.

It has been suggested that, where a person with elementary skills is employed in a large organization, it will be more difficult to prove that they occupy a “key position”.

However, the position may be different where the organisation is a small one or where the employee possesses specialist skills or training.  However, even in either of those cases, the employer must still demonstrate that the position can only be filled on a permanent basis due to the nature of the position itself.

In one case, a mid tier bank employee in a small New Zealand town was held to occupy a “key position” as she was a skilled employee whose role required a lengthy period of training, such skills and training being required for her position.

However, in a number of other cases, employees have not been found to occupy “key positions”, including a librarian, legal adviser and personal assistant to a Chief Executive.

4. A position can qualify as “key” but it may still be “reasonably practicable” to temporary replace that employee.

For example, where an employee within an organization could be temporarily transferred to cover the period of leave, the employer could not establish that a temporary replacement was “not reasonably practical”.  This was even though the employee taking leave occupied a “key position”.

Not reasonably practical to replace

1. When considering whether it is “reasonably practicable” to replace the employee temporarily, the question is not a subjective one (i.e. what the employer believes is practicable).

Instead, the test is an objective one – what a reasonable person, standing in the shoes of the employer, would conclude.

2. The test is not whether it would be impracticable or inconvenient to temporarily replace the employee with another employee for the period of leave.

Instead, the focus is on the level of skill required for the position and the size of the employer [that makes it necessary that the position only be filled on a permanent basis].  Any difficulties with replacing the employee, including operational inefficiencies, costs, or finding a temporary replacement, are not relevant unless they are due to the nature of the position itself.

In one case, for example, the fact that the employer was losing several of its staff at the same time, thereby putting remaining staff under pressure while new staff underwent training, was not held to be sufficient to demonstrate that the employee held a “key position”.

Likewise, difficulties in finding a person willing and able to replace an employee on a temporary basis did not suffice as it would have still been reasonably practical to fill the position if a temporary replacement had been available.

Further, in another, the fact that a temporary employee had previously provided leave cover precluded the employer successfully arguing subsequently that it was not practical to fill the position temporarily.

In summary therefore, the wording of the Act, together with subsequent case law, makes it clear that in many cases it is likely to be difficult for an employer to establish that they cannot keep an employee’s position open for a period of parental leave.

This article is not a substitute for legal advice and you should consult your lawyer about your specific situation. Please feel free to contact us at Parry Field Lawyers:

With COVID-19 in mind and the importance of employees staying home when sick so as to not spread illness to others, the Government has recently passed the Holidays (Increasing Sick Leave) Amendment Bill in order to double the availability of mandatory employer-funded sick leave for employees.  The new legislation will come into effect on 24 July 2021.  After that date, employees will become entitled to 10 days’ sick leave on their next entitlement date.

So what does this mean practically?

  • New employees after 24 July 2021 will receive 10 days’ sick leave as soon as they become entitled to sick leave, which is six months after starting their employment.  For example, an employee employed in August 2021 will become entitled to 10 days sick leave in February 2022, being six months later.
  • Existing employees, who already are entitled to sick leave when the legislation comes into force, will become entitled to 10 days’ sick leave on their next entitlement date. Their entitlement date is their anniversary date on which they first became entitled to sick leave.  For example, an employee who has a sick leave anniversary date of April, will have to wait until April 2022 to receive their 10 days, given their entitlement date pre-dates 24 July 2021.  However, an employee with an anniversary date of August 2021, will receive 10 days sick leave in August 2021.
  • If an employer already provides their employees with an entitlement to 10 or more sick leave days a year, the employee will not be affected by this change and will not receive any more sick leave.
  • The entitlements for employees are still carried over if unused, up to a maximum of 10 sick days per year (rather than 15 under the current legislation) and can be accumulated up to 20 days (which is the same total amount employees were already able to accrue up to, prior to the upcoming law change).

So what should employers do as a result of this change?

For new employees after 24 July 2021, they should be provided with an Individual Employment Agreements (IEAs) which reflects the change.

Whether existing employment agreements need to be amended really depends on whether these contradict the new law and, more especially, conflict with it.  Even if they do, some employment agreements already provide that they are varied by the terms of any legislative changes.  In any case, the changes are minimum statutory entitlements which cannot be contracted out of, meaning that employers need to comply, regardless of whether the employment agreement is less favourable to the employee than the upcoming change.

Employers should also check their payroll systems to make sure that they have been updated to reflect the changes, after 24 July 2021.

Finally, employers should also expect further changes regarding sick leave, as the Government has also recently begun to work on further recommendations which includes a proposal for employees to be able to access some sick leave from the first day of their employment, as opposed to only being eligible for sick leave after 6 months.  This legislation is expected to be introduced in early 2022.

This article is not a substitute for legal advice and you should consult your lawyer about your specific situation. Please feel free to contact us at Parry Field Lawyers:

Business can be complicated but it doesn’t have to be.  We have helped thousands of clients and know about the key legal areas that will affect you and have just released our fully revised and updated “Doing Business in New Zealand” free handbook.  You can download it here.

New Zealand consistently ranks as one of the most business-friendly nations in the world. Given this appealing status and the interest we receive both from local and international investors, as well as form businesses and entrepreneurs, we produced the “Doing Business in New Zealand” handbook a few years ago and now have fully updated it.  It is intended to introduce and provide information for those who may be unfamiliar with how business is done here. The handbook provides introduction on business structures, investment rules, employment, disputes, property, intellectual property, immigration, privacy and social enterprise, just to name a few examples.

If you have further enquires please contact Steven Moe at or on 021 761 292 or Kris Morrison at

Be sure to check out our other free guides too, such as Startups: Legal Toolkit and Social Enterprises in New Zealand: A Legal Handbook.  We also provide free templates for resolutions, Non Disclosure Agreements and other resources on our site as well as many articles on key topics you should know about.

Some of the hardest hit by the current Covid-19 crisis are small and medium sized businesses.  The Government has confirmed that they can now apply to their bank for a loan under the Business Finance Guarantee Scheme (the Scheme), set up by the Government in an effort to protect jobs and support the economy during the Covid-19 pandemic.

The Scheme works alongside the Wage Subsidy Scheme which is already available to businesses. The Scheme’s purpose is to help businesses with cash flow and operating expenses in the aftermath of the Covid-19 pandemic.

Not all businesses are eligible for the scheme, however if you are a business with an annual revenue of between $250,000.00 and $80 million you can apply to your bank for a loan of up to $500,000.00 for up to three years. The bank will determine your eligibility and determine the amount available to borrow. Applications under the Scheme are now open and are available until 30 September 2020, or until all available funds, being $6.25 billion, have been exhausted.

Applications under the Scheme can be made through your bank’s website and a standard lending process will be followed through the bank’s credit assessment process to determine eligibility. In addition, banks will take into consideration your circumstances due to the Covid-19 pandemic. The interest rate and other terms of the loan will be determined by the bank under their normal lending criteria.  Of course a basic question needs to be asked – does your business need more debt or can it survive without taking that on?

This is important to think through because all this really means is that the process is similar to getting a normal loan from the bank – the difference being the Government has agreed to guarantee 80% of the risk in relation to each loan with the remaining 20% to be guaranteed by the bank. If a business defaults on their loan under the Scheme, banks will follow normal enforcement procedures and it is likely that as a part of the loan process and terms the bank will have obtained personal guarantees (usually from company directors) or other security (for example a General Security Agreement over the assets of the Company) that they can enforce before relying on the Government guarantee of the loan. The guarantee provided by the Government is essentially a protection for banks who might not otherwise provide loans to companies and not as a protection for the businesses who are the ones that actually take out the loans.

For more information regarding this scheme you can refer to your bank’s website. Participating banks are ANZ, ASB, BNZ, Heartland Bank, HSBC, Kiwibank, SBS Bank, TSB and Westpac.  If you’d like to talk through your current position and options then you can always contact us.

This article is not a substitute for legal advice and you should contact your lawyer about your specific situation. We would be happy to assist you in your journey. Please feel free to contact Luke Hayward at or Emma Piercey (nee Garlick) at

With a large number of businesses not currently operating as they usually would due to Covid-19, many employers are wondering what they need to pay their employees for the upcoming statutory holidays.

This article considers two scenarios (1) where non-essential employees have been working from home over the lockdown period (albeit potentially in a reduced capacity) or (2) not working at all.

In general, employers are still required to pay their employees for statutory holidays that fall on a day that would have “otherwise been a working day” for the employee or if the employee has otherwise agreed to work on that statutory holiday (even if it not a usual working day for that employee).

However, as result of the Covid-19 lockdown, some employees are not able to work at all, giving rise to uncertainty about whether or not the upcoming statutory holidays would have “otherwise been a working day” for the employee or not.  The Holidays Act does not cover off this situation.

The advice below is of a general nature so, if you are considering not paying your employees for the upcoming public holidays, we strongly recommend that you obtain legal advice specific to your situation before doing so.  We are very happy to help if need be.

Non-essential employees working from home over Covid-19 who do not work on a statutory holiday

If an employee would have worked on a Friday or Monday (but for Good Friday or Easter Monday, for example), then that employee is entitled to be paid for that statutory holiday.  This includes an employee who has been working from home over the lockdown period, albeit potentially in a reduced capacity.

In that case, employers must pay their employees not less than:

(a)  The employee’s “relevant daily pay”; or

(b)  The employee’s “Average daily pay” for that day.

These words have specific meanings under the Holidays Act.  However, in general terms, “relevant daily pay” is the amount of pay that your employee would have received had the employee worked on the Friday (Good Friday) or the Monday (Easter Monday).  It can include things like overtime, bonuses and the like, if your employee would have usually received those things as part of their pay.

Consequently, if you have agreed with your employees that, over Covid-19, their pay or hours of work will reduce, then their “relevant daily pay” will reflect those new agreed hours/days of work (making sure you still comply with Minimum Wage obligations).

Likewise, if you have applied for the Government Wage subsidy, and have agreed with your employees that you will only pay them the relevant subsidy amount each day, then that would be their “relevant daily pay” (again making sure you comply with Minimum Wage obligations).

However, if there has been no change to the employee’s pay, you will simply pay the employee their usual daily pay.

If you are able to work out “relevant daily pay”, then this will be the amount you pay your employees.  If it is not possible/practicable to do so or the employee’s daily pay varies at the moment, then you would use “average daily pay”.

The employee’s average daily pay is calculated using this formula:



a.  is the employee’s gross earnings for the 52 calendar weeks before the end of the pay period immediately before the calculation is made; and

b. is the number of whole or part days during which the employee earned those gross earnings, including any day on which the employee was on a paid holiday or paid leave; but excluding any other day on which the employee did not actually work.

Non-essential employee working from home over Covid-19 who do work on a statutory holiday

If, however, your employee actually works on the statutory holidays (so long as that is agreed as per their employment agreement), then they are entitled to be paid:

Time and a half, calculated at the greater of

  • the portion of your employee’srelevant daily pay” or “average daily pay” (less any penal rates) that relates to the time actually worked on the day plus half that amount again; or
  • the portion of your employee’s“relevant daily pay” that relates to the time actually worked on the day.

If this would ‘otherwise be a working day’ for your employee, then they are also entitled to an alternative holiday.

Non-essential employee not working from home over Covid-19

The situation is less clear where a non-essential employee has not been working from over the Covid-19 lockdown (because it is not possible/practicable to carry out their usual duties from home due to the nature of their work).

The Holidays Act provides however that, where it is not clear whether a day would otherwise have been a working day, the employer and employee must attempt to reach agreement on this, taking into account such things as:

  • What the employment agreement says – does it cover off what will happen in the event of a pandemic?

Some agreements provide that, in the event of a pandemic resulting in a shutdown, the employer will neither provide work nor pay the employee over that time and the employee will not be required to work.

  • What is the employee’s usual work pattern, i.e. would they usually have worked that day, but for Covid-19, or does the employee generally only work for the employer when there is available work?
  • Whether the employee usually works pursuant to a roster system and what that roster would have provided but for Covid-19.

If agreement cannot be reached, a Labour Inspector can be asked to decide the matter but we anticipate that will be unlikely to occur before the upcoming statutory holidays.

Ideally employers and employee will work hard to try and reach agreement as to how employees in these situations will be paid for the statutory holidays, taking into account both the circumstances of the employer and the employee.    However, while, again, specific advice should be sought on your circumstances, our present view is that, if you have obtained the Government’ Wage subsidy, at a minimum that amount should at least be passed onto employees.  This is based on our current understanding of the Wage Subsidy, which may change if the Government provides further guidance.

This article is not a substitute for legal advice and you should contact your lawyer about your specific situation. Our team is experienced with employment law. We would be happy to assist you in your journey. Please feel free to contact Hannah Carey at or any of the team, should you require assistance.