Annual leave anniversary date question.

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JaseNZ

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Topic # 165701 17-Feb-2015 21:02

Just wondering if anybody knows about this. Sombody starts in March of last year , At Christmas time they are paid out 8% of there gross earnings up to that date (planned shut down for Christmas) as payout of annual leave because they have not been with the business for a year.
Are they entitled to another round of annual leave in March (which would be their year with the business) or do they have to wait until xmas which would be a year since last payout of annual leave.

Hope that makes sense and I would say I would have to ask an employment lawyer to verify what the story is but just in case any body knows.

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Reply # 1241125 17-Feb-2015 21:21

as they were paid up to date at the end of last year, then you will have to wait until end of this year

alienara

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Reply # 1241126 17-Feb-2015 21:25

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Haven't been in recruitment for 2.5 years and studied HR ages ago but from memory this is how it works.

Every month you work, you accrue approximately 1.67 days in annual leave. When that person was paid the 8% of the time that they've worked, it would be the equivalent of 9 months * 1.67 days = 15 days worth of annual leave.

At the beginning of the year, their annual leave will start accruing again, so by the end of March, they would have 3 months * 1.67 days = 5 days annual leave.

If that person takes all 5 days worth of annual leave, that means that by December they would only have 15 days annual leave instead of the full 20, if they didn't take any further paid annual leaves of course.

Depending on the company this person works for, some companies would even pay annual leave in advance and that person will then be in deficit. Some other companies may just go, since this person's paid annual leave is over, we'll make it an unpaid leave. It varies from company to company.

The other question that I see you potentially asking, is whether that person is entitled to take the leave in the first place. Depending on your employment contract, it may say that you're only able to take annual leave after a year.

In all circumstances, I would recommend double checking with your manager.

ObidiahSlope

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Reply # 1241175 17-Feb-2015 23:04

The "closedown periods" section of the Holidays Act 2003 will tell you all you need to know, but the shortened version is an employer who has a closedown period may use this as the anniversary of your entitlement and for the calculation of holiday pay.

Obsequious hypocrite

Geektastic

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Reply # 1241181 17-Feb-2015 23:16

I've never really understood why annual leave is so complex in NZ.

In the UK, you get a leave card at the beginning of each year. On the card, it says how may days you get (usually 25 for white collar jobs) plus any you carried over from last year (often up to 10 days are allowed).

Each time you want time off, you fill in the dates and the column that shows a reducing balance of days, give it to your manager, he signs it and sends it to HR who record it and return it to you. Granted, that process probably happens on a computer now, but I have not worked there for a long while...the process will be the same.

There is never any of this weird stuff about 'holiday pay' or anything like that unless you actually work in payroll or HR. Normal employees and managers do not need to know it. They just need to know how many days you have left at a given point of the year.

Why do they make it more complex than it needs to be?

If you leave part way through the year, HR just notify you that they will deduct X from your final pay to reflect the fact that you 'owe' leave to them or that they will add Y to your final pay because they 'owe' you leave.

tdgeek

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Reply # 1241196 17-Feb-2015 23:55

I don't think its complicated. There is an anniversary, and the payroll system will accrue x hours leave per pay period. Take hols and they come off. The OP issue, holiday pay accrued was paid out at Xmas, and will accrue to about one week by March. As stated, some employees may allow leave in advance, all will have maximum accrued leave so it doesnt build up to an excess, but the reality will vary employer to employer of the flexibility.

Jase2985

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Reply # 1241259 18-Feb-2015 08:44

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Geektastic: I've never really understood why annual leave is so complex in NZ.

You are always comparing everything to the UK. it really doesn't add/help the discussion

NZ is not the UK, we have different rules for different things, we are our own country, and we also have a lot less people. there are many reasons why we have different rules/regulations. whos to say the UK has the best set of rules for something? its just something you are used to because you lived there so long.

At the end of the day you cant compare as we are a different country, so there is no point getting wound up about it because it will change nothing

Behodar

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Reply # 1241266 18-Feb-2015 08:49

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Geektastic: I've never really understood why annual leave is so complex in NZ.

I guess it somewhat depends on where you work; I have no knowledge (and no need for it) around "anniversary dates" - I simply gain 6.15 hours of leave each fortnight (which works out to 20 days over a year) and can take time off whenever I like so long as I have sufficient balance and it's not conflicting with anything important.

Maybe HR/payroll has a convoluted system underneath, but as an employee it's simple.

trig42

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Reply # 1241280 18-Feb-2015 09:06

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Jase2985:
Geektastic: I've never really understood why annual leave is so complex in NZ.

You are always comparing everything to the UK. it really doesn't add/help the discussion

NZ is not the UK, we have different rules for different things, we are our own country, and we also have a lot less people. there are many reasons why we have different rules/regulations. whos to say the UK has the best set of rules for something? its just something you are used to because you lived there so long.

At the end of the day you cant compare as we are a different country, so there is no point getting wound up about it because it will change nothing

Agreed, we are not the UK, but Geektastic obviously wishes he still lived there - everything about NZ to him is archaic and backwards. He never stops complaining about NZ, maybe he should leave us to it?

Having said that - a friend of mine is there for a Gap Year at the moment - been there since early January.
He has a British Passport.
He has been waiting all that time for a National Insurance Card, so that he can get a Debit Card, so that he can get HIS MONEY out of a bank (which he is allowed to put in there). He has to go to meetings (which they stuffed up, they sent him to Slough, from Reading, when they had actually made the appointment half an hour in the other direction (sorry, don't remember name of the place they wanted him to go to). It is going on 6 weeks now - how is that better than NZ - takes about 10 minutes to get an ATM card here, and you can apply for an IRD number online.

Aaaanyway - what other posters have said here is correct - when the business closed down for Christmas, and all Holiday Pay accrued was paid out, the allowance went back to zero, and started accumulating again. If that employee wanted to take a holiday in (the end of) March, they would have a quarter of a years holiday pay accrued (5 days). No reason that can't be paid out.

I'm not 100% clear on closedown provisions, but if you don't close down for 20 working days, is it legal to pay out 20 days holiday pay - I know you can't pay out all of an employees holiday pay if say they are owed 4 weeks, but only take a week off?

trig42

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Reply # 1241292 18-Feb-2015 09:17

Behodar:
Geektastic: I've never really understood why annual leave is so complex in NZ.

I guess it somewhat depends on where you work; I have no knowledge (and no need for it) around "anniversary dates" - I simply gain 6.15 hours of leave each fortnight (which works out to 20 days over a year) and can take time off whenever I like so long as I have sufficient balance and it's not conflicting with anything important.

Maybe HR/payroll has a convoluted system underneath, but as an employee it's simple.

It isn't complex at all.
You accrue 8% of your wages (if on an hourly rate, with differing hours week to week), or 4 weeks per year (if Salaried) which is the same thing.
All Payroll software will do this, and at any time, an employee should be able to find out how much holiday pay they have accrued (we have it all online here at work, so we just log in, and there it is).
You can keep on accruing ad infinitum, there is no upper limit, but a good employer should force you to take holidays (they do not want a whole heap of accrued holiday pay on their books, it is a massive liability). We have people here at work that have in excess of 12 weeks, which management are constantly trying to bring down, Most times they just take an extended overseas trip. I just checked mine, and I have 6 weeks owing (but I am taking two weeks next month). I like to have a few up my sleeve for emergencies, and it is nice to have a few weeks owing when you leave a job as you can take a decent break between jobs (or get a nice cash payout).

MileHighKiwi

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Reply # 1241294 18-Feb-2015 09:18

Geektastic: I've never really understood why annual leave is so complex in NZ.

In the UK, you get a leave card at the beginning of each year. On the card, it says how may days you get (usually 25 for white collar jobs) plus any you carried over from last year (often up to 10 days are allowed).

Each time you want time off, you fill in the dates and the column that shows a reducing balance of days, give it to your manager, he signs it and sends it to HR who record it and return it to you. Granted, that process probably happens on a computer now, but I have not worked there for a long while...the process will be the same.

There is never any of this weird stuff about 'holiday pay' or anything like that unless you actually work in payroll or HR. Normal employees and managers do not need to know it. They just need to know how many days you have left at a given point of the year.

Why do they make it more complex than it needs to be?

If you leave part way through the year, HR just notify you that they will deduct X from your final pay to reflect the fact that you 'owe' leave to them or that they will add Y to your final pay because they 'owe' you leave.

That's how things work at my company.

We can accumulate annual leave but not sick leave. I have one colleague who has something like 55 annual leave days owing. When he leaves, if he ever does lol, he will get a niiice payout.

trig42

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Reply # 1241302 18-Feb-2015 09:29

MileHighKiwi:
Geektastic: I've never really understood why annual leave is so complex in NZ.

In the UK, you get a leave card at the beginning of each year. On the card, it says how may days you get (usually 25 for white collar jobs) plus any you carried over from last year (often up to 10 days are allowed).

Each time you want time off, you fill in the dates and the column that shows a reducing balance of days, give it to your manager, he signs it and sends it to HR who record it and return it to you. Granted, that process probably happens on a computer now, but I have not worked there for a long while...the process will be the same.

There is never any of this weird stuff about 'holiday pay' or anything like that unless you actually work in payroll or HR. Normal employees and managers do not need to know it. They just need to know how many days you have left at a given point of the year.

Why do they make it more complex than it needs to be?

If you leave part way through the year, HR just notify you that they will deduct X from your final pay to reflect the fact that you 'owe' leave to them or that they will add Y to your final pay because they 'owe' you leave.

That's how things work at my company.

We can accumulate annual leave but not sick leave. I have one colleague who has something like 55 annual leave days owing. When he leaves, if he ever does lol, he will get a niiice payout.

We can accumulate Sick Leave, but only up to 10 days. Some places it just goes on and on. When my mother retired from teaching, she had about 6 months Sick leave accumulated (which, obviously, doesn't get paid out).

Paul1977

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Reply # 1241306 18-Feb-2015 09:32

MileHighKiwi: We can accumulate annual leave but not sick leave. I have one colleague who has something like 55 annual leave days owing. When he leaves, if he ever does lol, he will get a niiice payout.

I believe the law has been changed and everyone (regardless of their contract) can accrue up to 20 days of sick leave (more if your contract allows for it).

http://www.dol.govt.nz/workplace/knowledgebase/item/1308

Edit: added link to DOL website about unused sick leave.

trig42

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Reply # 1241315 18-Feb-2015 09:37

I don't think they can stop it accruing - if you keep working it keeps accruing. It is the employers responsibility then to make you take a holiday.

Paul1977

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Reply # 1241320 18-Feb-2015 09:41

trig42: I don't think they can stop it accruing - if you keep working it keeps accruing. It is the employers responsibility then to make you take a holiday.

I think you are right for annual leave, but they can stop accruing sick leave after 20 days (unless your contract specifies otherwise).

trig42

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Reply # 1241324 18-Feb-2015 09:48

Paul1977:
trig42: I don't think they can stop it accruing - if you keep working it keeps accruing. It is the employers responsibility then to make you take a holiday.

I think you are right for annual leave, but they can stop accruing sick leave after 20 days (unless your contract specifies otherwise).

Oh, cool. Thanks.

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