Workplace Relations and Safety Minister Brooke van Velden has ruled out any move to cut New Zealand workers’ sick leave entitlements from 10 days to five, confirming that the government is instead focused on making leave proportional to hours worked.
The clarification followed comments by Prime Minister Christopher Luxon on RNZ’s Morning Report, where he was asked whether his government planned to reduce the number of sick leave days. Luxon said the matter was something van Velden was looking into, as part of a broader review of workplace relations, but described any such change as premature.
Van Velden later told RNZ that reducing sick leave entitlements was not part of her agenda. She said her officials had been working on developing pro-rated sick leave, which had already received Cabinet approval, and confirmed there had been no work undertaken to reduce the entitlement from 10 days to five.
Under current legislation, all employees — whether full-time, part-time, or casual — are entitled to 10 days of sick leave annually if they have been with their employer for at least six months, have worked an average of 10 hours per week, and meet certain minimum weekly or monthly hours. Workers can carry over up to 10 days of unused sick leave, up to a maximum of 20 days.
Luxon acknowledged that there may be a need to review the settings to ensure proportionality, particularly between part-time and full-time workers. He said van Velden was examining a broader package of changes to workplace relations, which would continue to be a focus for her.
Van Velden, who is a member of the ACT Party, described the proposed changes as long-needed and indicated that an announcement could be expected in the coming months. She is currently drafting a bill that proposes making sick leave entitlements proportional to the hours an employee works.
She has previously said that workplaces with a high reliance on part-time workers are especially susceptible to unexpected staffing shortages, and that the exposure draft would include a proposed approach to pro-rating leave entitlements to more accurately reflect working hours.
The National Party, which leads the current government, had promised during the 2023 election campaign that it would not reduce the number of sick leave days. The entitlement was increased from five to 10 days in 2021 by the Labour government, as part of its response to the Covid-19 pandemic — a move National did not support at the time.
Following the changes, data showed that the average number of sick days taken per employee in 2022 reached 5.5 — the highest on record — compared to an average of 4.2 to 4.7 days in the years between 2012 and 2020.
Employers and Manufacturers Association (EMA) head of advocacy, Alan McDonald, said that a potential reduction in sick leave had not been raised in any discussions with the Minister’s office, the Ministry of Business, Innovation and Employment (MBIE), or other employer representatives. He noted that while it may not be entirely off the table, it had not been a topic of conversation among employer groups or organisations like Business New Zealand.
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