If you employ staff in New Zealand, it is crucial to understand your employer obligations. Knowing the rules will help you minimise the risk of an employment dispute, as well as helping you earn the respect of your employees and the community. Being recognised as a fair employer can help you attract and retain better talent. In turn, this can increase your staff’s productivity and lower your recruitment costs. Employment law issues can be overwhelming. This article will list some of your essential obligations and rights as an employer when dealing with sick leave entitlements in New Zealand. 

What Is Sick Leave?

Sick leave is paid time off work if an employee or their dependents (spouse, partner or dependent child) falls ill or gets injured. As an employer, you have a legal obligation in New Zealand to pay for five days sick leave each year, depending on how long your employee has worked for you. 

This can change with changes in government policies, so please check the Employment New Zealand website for the most up to date information.

All employees in New Zealand, whether they are full, part-time or casual, are entitled to five days sick leave a year. Your employees are initially entitled once they have worked for you for:

  • six months continuously; or 
  • an average of ten hours per week, and at least one hour in every week or forty hours in every month.

Once they have met this initial requirement, they have the right to receive an additional five days sick leave every year. If in any twelve-month period your employee does not meet these criteria, they are not entitled to receive any new sick leave on that year.

Who Is Entitled to Sick Leave?

Sick leave entitlements can be confusing. You can use accounting or payroll software to automatically calculate your employees’ leave entitlements. However, it is essential to understand the rules to make sure that you are including the correct amount of sick leave in your employment contracts and to be able to answer any employees concerns in this area. According to the rules: 

  • employees are only entitled to receive sick pay if they were supposed to work on that day;
  • you can pay sick leave in your regular pay cycle;
  • you cannot prorate sick leave entitlements; for example, for part-time employees;
  • if an employee works for part of the day because they are sick, you can either count this as a whole day or deduct a half-day of sick leave; 
  • you can put a system in place for your employees to communicate with you as soon as possible when they need to take sick leave;
  • you can agree to increase your employees’ sick leave entitlements in their employment agreement;
  • if your employee has run out of sick leave, you can advance their future entitlements, allow them to take unpaid leave or utilise some of their annual leave;
  • you may enable your employee to use sick leave during annual holidays and you can request a medical proof before allowing the change; 
  • employees should receive their relevant daily pay (in some instances a half day rather than a full day) or their average daily pay, including overtime if applicable;
  • you need to carry over any unused sick leave balance for up to a maximum of 20 days per year; and
  • you can enable your employees to take time off work to attend a doctor’s appointment, but you are not legally required to do so unless agreed in the employment agreement.

Can You Request Medical Proof?

You can ask your employee to provide you with a medical certificate as proof of their illness or injury: 

  • once they have been away from work for more than three consecutive days; or 
  • earlier than three days, if you pay for their doctor’s appointment. 

You cannot force your employee to have a medical examination or tell them which doctor they have to visit. However, if they refuse to provide a medical certificate, then you do not have to pay for their sick leave. 

Do You Have to Pay Sick Leave on Top of ACC Compensation?

When your employee has an accident or injury, whether it is work-related or not, your obligations will be slightly different. In New Zealand, any person injured in an accident receives Accident Compensation Corporation (ACC) insurance payments. As an employer, you:

  • do not have to pay your employee if they are receiving ACC payments; 
  • cannot make your employee take sick or annual leave if they are receiving ACC compensation; and
  • can agree to top up their ACC payments to 100% by using one day of the employee’s sick leave for every five days’ leave taken.

Key Takeaways 

As an employer, you are required by New Zealand law to provide paid time off work to your employees if they cannot come to work due to an illness or injury for a maximum of five days a year, unless you agree to additional days in your employment agreement. Your employees, including part-time and casual, have to meet specific criteria to be eligible. If you need help understanding your legal employment obligations or reviewing your employment agreements, contact LegalVision’s experienced employment lawyers on 0800 005 570 or fill out the form on this page.

FAQs

How many sick days do employees get in a year in NZ?

Employers have to pay five days’ sick leave in a year if their employees have worked for them for a minimum of six months. This entitlement also applies to casual and part-time employees.

Can employees use sick leave for doctor’s appointments in NZ?

Typically, an employee cannot use sick leave to attend a doctor’s appointment, unless their employer agrees to it. This is because going to the doctor is not considered the same as being sick or injured.

Is stress leave paid in NZ?

In New Zealand, there is no legal entitlement for stress leave from work unless an employee becomes ill due to stress. However, there are other ways in which employees can agree to take time off with their employer.

Can employees use annual leave for sick leave in NZ?

An employee can request to use annual leave if they run out of sick leave, but it is up to their employer to agree to this.

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