1. Legislative Review 2006 A Review of the Holidays Act and Your Obligations An answers guide for Participants of the 2006 Sessions

2. Those Employees Who Work Less Than A Year

3. Entitlement Entitlement to annual holidays does not arise until employee has completed 12 months’ continuous service

4. Payment 6% payment if employment terminates before 12 months’ continuous service completed Increasing to 8% after 1 April 2007

5. Brain In Gear? The correct answer is actually: $4,100.

6. Example 1: Simple Holiday Pay $24 ($10 x 40 hours x 6%)

7. Pay As You Go Pay as you go if employment fixed-term or “intermittent and irregular” Agreement to “pay as you go” must be in employment agreement “Pay as you go” must be paid as an identifiable component

8. Example 2: PAYG $24 PAYG each week.

9. Example 3: PAYG - 1 Year On If you haven’t followed the “Fixed Term Agreement” rules George is now entitled to three weeks’ holiday on pay so he is due $400 for one week If you have followed the “rules” you can continue to pay as PAYG – with the employee’s agreement

10. Holidays in Advance The greater of the employee’s ordinary weekly pay or average weekly earnings The divisor is reduced so that it represents the number of whole or part weeks the employee has worked

11. Example 4: Different Assignments None. Emily hasn’t worked for a year so she is not entitled to any annual holidays But if you were to pay her you would pay as annual holidays in advance = $80 per day. Also - if you have rolled the two assignments together (not paid the previous holiday pay out) in which case she would be paid $133.33

12. Example 5: 1 April 07 $48 $32 $96

13. 1 April 2007 and PAYG First Week: $24 Second Week: $64

14. Example 6: 1 April 07 Three weeks None – she already has her three week entitlement and is only due four weeks on 28 March 2008 Four weeks

15. Those Employees Who Work For More Than A Year

16. Entitlement At least 3 weeks per annum Entitlement does not arise until employee has completed 12 months’ continuous service Increasing to 4 weeks from 1 April 2007 Paid at greater of employee’s ordinary weekly pay or average weekly earnings

17. Ordinary Weekly Pay Ordinary weekly pay means the amount of pay the employee receives under his or her employment agreement for an ordinary working week. It includes: –Regular productivity or incentive-based payments –Regular overtime payments

18. Average Weekly Earnings Average weekly earnings are 1/52 of employee’s gross earnings Gross earnings are all payments an employee is entitled to under his or her employment agreement, including: –Salary/wages –Allowances –Holiday pay –Overtime –Non-discretionary bonuses

19. Example 1: Weekly Earnings: Permanent Staff $1,192.30 The greater of: “Ordinary Weekly Pay ($1,000) or “Average Weekly Earnings” $1,192.30 $1,576.92 The greater of: “Ordinary Weekly Pay or “Average Weekly Earnings” $1,576.92

20. Example 2: Weekly Earnings: On- Hire Workers $1,500 The greater of “Ordinary Weekly Pay” ($1,500) or “Average Weekly Earnings” = $846.15)

21. Public Holidays

22. If employee works, entitled to be paid at least time and a half of relevant daily pay for hours actually worked If employee doesn’t work, but day would otherwise be a working day for him or her, entitled to be paid relevant daily pay If employee doesn’t work and day would not otherwise be a working day for him or her, not entitled to any payment

23. Relevant Daily Pay Relevant daily pay –The amount of pay the employee would have received if he or she had worked - Productivity or incentive-based payments -Overtime -If unable to calculate, Holidays Act provides a formula

24. Alternative Holidays Alternative holidays –If public holiday falls on day that would otherwise be a working day for employee –The employee works on any part of that day Whole day alternative holiday, regardless of how long employee works on public holiday

25. Alternative Holidays Alternative holiday paid at employee’s relevant daily pay Within first 12 months, employee may elect when to take alternative holiday Can be cashed up if 12 months have passed since the entitlement arose

26. Public Holidays on Termination If an employee’s employment ends and he or she has an entitlement to annual holidays, entitled to be paid for a public holiday if: –It would otherwise have been a working day; and –If the employee had taken his or her outstanding holidays it would have fallen in that period

27. Example 1: Public Holiday Pay When Assignment Finished Early Nothing – the Public Holidays are not days he would normally have worked

28. Example 2: Pub. Hol. Pay When a New Assignment Starts Later Nothing – the Public Holidays are not days she would normally have worked.

29. Example 3: Public Holiday Payments Working Days $100 for each day as they are days she would normally have worked

30. Example 4: Public Holiday Payments: Non Working Days Nothing – the Public Holidays are not days he would normally have worked

31. Example 5: Working Part Hours on A Public Holiday Xmas Day: = $75 No Alternative Holiday Boxing Day = $0.00 New Years Day = $0.00 2 Jan = $0.00

32. Example 6: Alternate Day Payment $200 for the Alternate Holiday Xmas Day = $75 Plus an “Alternate Holiday” in the future Boxing Day = $100 New Years Day = $100 2 Jan = $100

33. Example 7: On Call If he is unrestricted – ie heads to Taupo for Xmas Day and chooses not to accept a call out: $100 If he is restricted then he gets $100 Plus an Alternate Holiday $75: $12.50 x 4 hours x T 1 ½ Plus an Alternate Holiday

34. Example 8: Weekend/Week Work Xmas Day $112.50 Plus an Alternate Holiday Boxing Day = $100 New Years $112.50 Plus an Alternate Holiday 2 Jan = $100

35. Example 9: Final Pay $3,490 Final Weeks wages = $500 Two Weeks untaken Annual Holidays = $1,000 Three weeks new Annual Holiday entitlement falling due on 4 December 2006 = $1,500 6% Holiday Pay from 4 December 06 to 22 December = $90 4 Public Hols that fall within last day at work plus the 25 days untaken Annual Holiday = $400

36. Any further questions?

37. For More Information Contact: Anna Clark KensingtonSwan 09 918 6511 or Anna.clark@kensingtonSwan.com Or Andrew McComish 03 3545465 or andrew@thinkhr.co.nz