Source: EMA
The Employers and Manufacturers Association (EMA) says the Employment Leave Bill, which was introduced to Parliament today, marks a significant and long-overdue step towards fixing a Holidays Act that has frustrated employers and employees for more than a decade.
Alan McDonald, Head of Advocacy and Strategy at the EMA, says it is encouraging to see the reform progressing at pace after several previous attempts stalled.
“Successive governments have acknowledged the problems, but this is the first time in years we’ve seen meaningful progress,” he says.
“It’s good to see the reforms maintaining momentum as this overhaul has been needed for a very long time.”
McDonald says the Bill’s shift to a standard-hours-based calculation is a major improvement, but one that will require employers and employees to work through the practical implications.
“It significantly simplifies the system for both employers and employees, which is what everyone has been asking for. But there’s still a bit for employers to get their heads around, particularly how standard hours apply to existing arrangements and how employment contracts may need to be updated.”
The two-year implementation window for the new legislation is sensible and gives employers and employees time to adjust to new systems, rewrite contracts, and work through transition issues.
“There are questions that need more clarity as implementation approaches,” McDonald says.
“In particular, how existing leave balances will be treated, how built-up entitlements will roll over to the new system, and how the rules apply to people with variable or commission-based earnings. Those transition details matter, and employers and employees need certainty on how to manage those changes.”
McDonald says EMA members will welcome the pro-rata approach for sick leave entitlements for part-time workers.
“Ten days’ sick leave for all workers, regardless of whether they work one shift or five, was introduced as a Covid-era measure that we didn’t support at the time. Moving to a pro-rated system for part-time workers is fairer and better reflects the reality of modern work.”
McDonald says the Leave Compensation Payment (LCP) is an important offset to the change for part-time and casual workers, but it’s another new concept employers need to manage.
With the Bill now before Parliament and submissions opening shortly, the EMA is encouraging members to back the reforms.
“Now that we have a workable solution on the table, we want to see the base settings stay in place long enough for the new system to bed in,” McDonald says.
“The old rules were universally seen as unworkable, but no one wants to finally fix it only to have it quickly changed again.”
He says the submission process is the right time for employers to raise technical issues or propose refinements.
“This is the moment to make improvements. The next few weeks will be important, and we’ll be urging our members to submit in support of the Bill.”
Once the Employment Leave Bill has passed its first reading, submissions can be made to Parliament’s Education and Workforce Select Committee.
