Home > Our Publications > New Zealand Outlook > 2004 > February

NEW ZEALAND workers are due to get an extra week's holiday to give everyone a minimum of four weeks. But they'll have to wait until 2007.
Prime Minister Helen Clark's endorsement of four weeks annual leave for all workers will satisfy hardly anyone.
The four weeks minimum leave will come into force on April 1, 2007, and will be introduced in one step, not incrementally as earlier indicated.
"We believe that four weeks annual leave will be good for New Zealand.
"By giving three and-a-half years advanced notice of the change, employers, including the Government, will have time to plan for the change," Mrs Clark told the Labour Party conference recently.
While the Council of Trade Unions publicly endorsed the announcement by Mrs Clark, behind the scenes union leaders were unhappy.
Engineering Printing and Manufacturing Union secretary Andrew Little said that while he was pleased with the commitment from Mrs Clark, he was less than happy with the timing.
He was still hoping there was some way of influencing the Government to introduce the extra leave earlier than 2007.
Employers, who put the cost of the fourth week of leave at $1 billion, will not be happy, particularly those with small businesses who say they will either have to take on an extra staff member or close for longer at Christmas to accommodate the extra leave.
Compliance costs of altering payrolls will also prove contentious for employers.
Workers who already get a minimum of four weeks holiday a year, are expected to ask for five weeks and those who get five will ask for six.
But Mrs Clark said the extra week was a boost for working parents who would be able to spend more time with their families.
"This is especially important these days as many people are working longer hours than in the past.
"There is the issue of equity between employees, with many, particularly those in white collar managerial positions, already enjoying four weeks leave through their employment agreements, while most manual workers currently miss out," the Prime Minister said.
Four weeks annual leave was also important if New Zealand was to compete internationally in attracting and retaining skilled people, she said.
Labour Minister Margaret Wilson said compliance costs would be kept to a minimum by having the extra holiday entitlement take effect on April 1.
The date dovetailed with the tax year, which was when businesses normally updated their payroll systems.
The Government puts the cost of the extra week to business at $350 million but assumes there will be a 10 per cent increase 1 in productivity.
Background material released by Mrs Wilson said it was likely absenteeism, sick leave and workplace accidents would decrease. More holidays were also good for domestic tourism, the papers said.