Earlier this year the Government established a Holidays Act Taskforce to review and make recommendations about the Holidays Act 2003 (the Act). The Taskforce released an issues paper in late August setting out its various observations about the current state of the law around holidays. Submissions on the paper closed on 12 October 2018, and the Taskforce is now considering submissions received. It intends to report back to the Government with recommendations by mid-2019.
The Taksforce paper identifies that the current holidays regime can be difficult to both understand and to apply, particularly where non-standard work arrangements are involved. That complexity has led to widespread non-compliance and many employees not receiving their legal entitlements. Remediating historical non-compliance and ensuring ongoing compliance with the Act can also be expensive and time consuming for employers.
The aim of the Taskforce is to make recommendations to the Government that will help to simplify the administration of holidays entitlements, provide greater certainty and clarity for both employees and employers, and protect employees entitlements.
Key issues identified by the paper include:
It is unlikely there will be any changes to the current Act until at least late 2019 at the earliest (but probably later). In the meantime employers are still expected to comply with their legal obligations and to ensure that employees receive their legal holiday entitlements. Failure to comply with legal obligations risks claims for arrears, and potential penalties for breach of the Act. With a six year limitation period on arrears claims and penalties of $20,000 per breach for an organisation ($10,000 per breach for an individual), liabilities have the potential to be significant.
If you have questions about your Holidays Act obligations or entitlements, contact our employment law team.