Swain Paul: Holidays Amendment Bill — Second Reading 
Swain Paul: Holidays Amendment Bill — Second Reading 
[Volume:620;Page:15967] 
Hon PAUL SWAIN (Minister of Labour) 
: 
 I move  
That the Holidays Amendment Bill be now read a second time 
. I would like to thank the members of the Transport and Industrial Relations Committee for their diligent work on the bill in the short time frame that they were presented with. The minor amendments that they have recommended to the bill further ensure that the unintended consequences of the Holidays Act 2003 are removed. I note that the bill addresses only the unintended consequences of the Holidays Act and that the Government’s core policies in this area have not changed. The underlying policy of the Holidays Act was to give all employees basic minimum rights to holidays and sick and bereavement leave. 
The Government remains committed to ensuring employees are guaranteed an additional payment for working on a public holiday. Most New Zealanders think this is fair. We also are bringing in 4 weeks’ annual leave from 2007 to bring us in line with our key trading partners notably Australia which has had 4 weeks’ annual leave for about 30 years. I point out to the House that the National Party has pledged to remove the right to 4 weeks’ annual leave notwithstanding the fact that the Leader of the Opposition had 4 weeks’ annual leave as of right when he was the Governor of the Reserve Bank. 
However putting that aside there have been concerns about the implementation of the Holidays Act and in July this year I established a working-group to look at the issues and discuss how the Act could be amended to remove any actual or potential unintended consequences. The working-group consisted of employer and union organisation representatives as well as some large employers. I commend the working-group for the constructive approach taken by all participants despite their varied interests. 
The bill amends the requirement for an employee to be paid time and a half on a public holiday to ensure that the employee is not paid this on top of an amount already designed to compensate for working on a public holiday or a particular day of the week. This amendment will prevent double-dipping. In response to concerns from submitters the select committee has also clarified that payments for a sixth or seventh day of work or other similar payments are not considered payments for a public holiday or a particular day of the week. This formulation will mean that employers are fairly remunerated with a minimum entitlement of time and a half while preventing a windfall for employees who already receive a superior entitlement under their employment agreement. 
The Holidays Act provided for situations where an employer has in the past incorporated public holiday penal rates into an employee’s regular or composite pay rate. The Act currently allows employers to pay for work on a public holiday with the employees’ regular pay until 1 April 2005 to give the parties time to determine whether the penal component of the pay rate has been included. The bill proposed to extend this transitional provision for collective agreements until the later date of either 1 April 2007 or the date when a replacement collective agreement comes into force. In addition the bill now provides with recommendations back from the committee that where individual employment agreements incorporate public holiday penal rates in the employees’ regular pay these employees can also be paid on this basis until 1 April 2007. 
The bill clarifies the position regarding an employee who is sick or bereaved on a public holiday. The bill provides that the day will be treated as an unworked public holiday rather than as sick or bereavement leave and the employee will not receive any extra payment of time and a half or a paid day in lieu. This change addresses a significant area of concern and was well received by submitters to the select committee. 
At present an employer may seek proof of sickness or injury if an employee has been absent for 3 consecutive days. The bill entitles the employer to seek proof of sickness within the 3-day period where the employer has reasonable grounds to suspect that the sick leave is not genuine informs the employee as early as possible and bears the cost of obtaining the proof. The bill now clarifies that an employee is entitled to visit a doctor of his or her choice to obtain proof of sickness as an employer does not have the right to direct the employee as to which doctor he or she must visit. The select committee also considered that employers should not be required to pay for any unnecessary expenses incurred by the employee in obtaining proof of sickness. Therefore the employer will now be required to pay only the employee’s reasonable expenses in obtaining the proof. 
Some submitters expressed concern that an employee may be unable to provide proof because he or she may not be able to afford to or because a dependant refuses to go to a doctor. Under the Act an employer is not required to pay an employee for sick leave if the employee does not provide the proof. In response to that the select committee considered that the bill should be amended to provide that an employer does not have to pay an employee for sick leave if the employee unreasonably fails to provide proof. 
To conclude the bill retains the integrity of the Holidays Act and its emphasis on ensuring basic holiday leave sick leave and bereavement leave entitlements for employees. At the same time the bill makes some changes to clarify areas of uncertainty and to accommodate legitimate employer concerns about how particular aspects of the Act may be impacting unfairly on employers. I congratulate the select committee and the people who made submissions. It was a short period of time and the select committee has come back with a very good piece of work. 
I am very keen to hear from the Opposition spokesperson whether the National Party still continues to pursue its policy of pledging to remove the right to 4 weeks’ annual leave which will come into force on 1 April 2007. That of course was a right that the Leader of the Opposition had when he himself was the Governor of the Reserve Bank. If that is the case the member should know that there will be a campaign based along the lines of this statement: “The Leader of the Opposition wants to take a holiday—everyone else’s.” I recommend the bill to the House.