The Holidays (Increasing Sick Leave) Amendment Bill has passed its final hurdle in Parliament, and will see the amount of employer funded sick leave double from five to 10 days. The increase to sick leave entitlements will take effect two months after the Bill receives Royal Assent, giving employers until mid-July to prepare for the additional costs.
Once the change becomes law…
- The maximum amount of unused sick leave that an employee can be entitled to under the Act will remain 20 days
- Every employee would be entitled to 10 days’ sick leave each year (provided they qualify based on the existing conditions), regardless of their working pattern
- Employees will receive the increased entitlement on their next sick leave entitlement date after the law commences (rather than all employees receiving the additional sick leave on the same day).
Under the current Holidays Act 2003, employees are entitled to sick leave once they have worked with the same employer for 6 months. Sick leave can be used when an employee is unwell or injured, or when someone who depends on them for care is unwell or injured.
After the Bill’s commencement, an employee would first become entitled to 10 days’ sick leave on their next entitlement date. This means that new employees will receive 10 days’ entitlement as soon as they become entitled to sick leave (i.e. after they have completed 6 months’ service). Employees who already have a sick leave entitlement when the legislation comes into force will become entitled to 10 days’ sick leave on their next entitlement date. That is, on the 12 month anniversary of when they last became entitled to sick leave.
The Government has also begun work to implement the recommendations of the Holidays Act Taskforce, which includes giving employees access to sick leave from day 1 of employment, as opposed to only being eligible after 6 months. The Government expects to introduce this legislation in early 2022.