We all know that payroll compliance can be a nightmare. Automated systems don’t necessarily fit individual situations, employee work patterns don’t always fit the mould, and this is overlaid with a very technical area of the law. And to make matters worse; maths!

In particular, we know that many companies have had difficulty complying with the Holidays Act 2003. Numerous companies have been caught out in Ministry of Business, Innovation and Employment (MBIE) audits, including government agencies, and even MBIE itself.

Frighteningly (for us at least) many of the problems that have been identified were not difficulties with the interpretation of the law but just a misapplication of it where the law is actually quite clear. That said, there are some particularly difficult parts of the Holidays Act that require careful consideration.

Over the last year or so, Employment New Zealand (a team within MBIE) has brought together a team of professional service providers, payroll experts and other stakeholders to try and develop guidance for employers on interpreting and implementing the Holidays Act. Our very own Jim Roberts has been a part of this working group.

We are thrilled to announce that the first part of Holidays Act 2003: Guidance on annual holidays and related provisions has now been published on MBIE’s Employment website, and is available for your use.

This document deals with Annual Holiday entitlements, including what entitlements are available, when, and how to pay them. It sets out Key Messages for Employers, Employees and Professional Services Providers, and Key Steps for reducing the Risk of non-compliance.

It also has definitions of important terms in the Holidays Act, examples of scenarios throughout, and an Appendix with more detailed scenarios. If you are struggling with the beast that is compliance, and looking for detailed assistance, this will definitely help you out.

There are still issues that require advice but these have, hopefully, been reduced by the information in these guidelines.