Government 'open-minded' about giving sick leave before finishing six months in a job

The Government is "open-minded" about giving sick leave to workers even before they have finished six months in a job, Workplace Relations Minister Michael Wood says.

Wood made the revelation speaking to Parliament's Education and Workforce Committee, which is overseeing the Government's proposal to extend sick leave from five days to 10, in line with other countries like Australia. 

Green Party workplace relations spokesperson Jan Logie asked Wood during a committee meeting via Zoom if the Government would be open to considering sick leave for workers who have not yet completed six months in a job. 

"I'm really aware that the rationale that's being offered for this is noting the lessons we're learning through COVID and the importance of people having statutory protection for taking sick leave," Logie said. 

"That would seem to me on a principled level to apply from the date of first employment rather than kicking in at six months."

Wood said it is already under consideration as part of a review of the Holidays Act, the piece of law that outlines minimum entitlements to annual holidays, public holidays, sick leave, and bereavement leave for workers.  

But Wood said he would encourage the Education and Workforce Committee to explore the prospect of allowing employees to take sick leave before they have completed six months of work, particularly with the threat of COVID-19. 

"It wouldn't necessarily need to be the full entitlement from day one - it might be a bit of a bleed in where there's something that's available at the outset and it builds up to full entitlement within six months or some other period of time.

"Obviously there is a certain logic to that, which is that sickness doesn't discriminate whether you're on day one of your employment or day 700 of your employment, and if you get sick at that point we would want you to be staying at home and not have insufficient income.

Green Party workplace relations spokesperson Jan Logie.
Green Party workplace relations spokesperson Jan Logie. Photo credit: Education and Workforce Committee

"There's a counter view which is kind of that you sort of have to earn your sick leave, that's effectively there, and clearly there are some arguments against that."

Wood said it's a prospect the Government is "open-minded" on.

Business NZ chief executive Kirk Hope said doubling the statutory minimum sick leave would bring significant additional costs for some businesses, and even more so if it is rolled out from a worker's first day. 

"Rolling it out from an employees' first day on the job will bring forward a significant expense for business at a time when compliance, production, and insurance costs are on the rise," he told Newshub. 

He said small and medium businesses (SMEs) will be particularly affected at a time when they are still recovering from the COVID-19 shock.

"Businesses will need sufficient time to be able to factor in those extra costs. It will also be important for the Government to listen to businesses through the select committee process so that they understand the issues some businesses may face when they cannot absorb or pass on increased costs.

Workplace Relations Minister Michael Wood.
Workplace Relations Minister Michael Wood. Photo credit: Education and Workforce Committee

"The Government should not impose costs without reflecting on the impact on business sustainability."

ACT's employment relations spokesperson Chris Baillie told Newshub: "The current law works. There's no problem to solve. This is just Labour dumping more costs on employers."

Labour promised to double sick leave during the election campaign and Prime Minister Jacinda Ardern introduced the Holidays (Increasing Sick Leave) Amendment Bill a month later. 

The law change comes with a catch; you won't be able to save up sick days more than you already can. The legislation keeps the current maximum entitlement of any unused sick leave at 20 days annually. 

It's expected to pass in mid-2021 with any changes coming into force two months after it passes its third reading and is given Royal assent, meaning it becomes law. 

Business NZ CEO Kirk Hope.
Business NZ CEO Kirk Hope. Photo credit: The AM Show

The Government has stepped in to fill the immediate void of limited sick leave with the COVID leave support scheme which ensures those who have had a coronavirus test and need to self-isolate can still get paid.

The legislation to increase sick leave was introduced following controversy surrounding an Auckland retail worker who tested positive for COVID-19 in November and went into work despite showing symptoms. 

Logie said at the time it showed the need for urgent extended sick leave.

"The difference between five and 10 days off could be the difference between increased community transmission of COVID-19 or not."

Treasury estimates the cost of increasing sick leave to 10 days will be approximately $958 million per year across New Zealand.