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Disclaimer: Educational purposes only. Not legal advice. Consult a qualified NZ legal practitioner for your specific circumstances.

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employment

Can an employer force you to take annual leave?

Key Takeaway

While generally annual leave in New Zealand requires agreement, an employer can compel an employee to take it under specific circumstances. This typically involves giving at least 14 days' notice and occurs where no agreement can be reached or during an annual close-down period, as outlined in the Holidays Act 2003.

Can an Employer Force an Employee to Take Annual Leave in New Zealand?

In New Zealand, the taking of annual leave, also known as annual holidays, is generally by agreement between an employee and their employer. However, there are specific circumstances under which an employer can require an employee to take annual leave, even without the employee's agreement. These rules are primarily governed by the Holidays Act 2003.

Entitlement to Annual Leave

Employees are entitled to 4 weeks of paid annual holidays after completing 12 months of continuous employment with the same employer [Source: Holidays Act 2003, s 16(1)]. This entitlement is a fundamental right under New Zealand employment law.

General Rule: Agreement for Taking Annual Leave

Typically, annual holidays are taken at a time mutually agreed upon by the employee and the employer [Source: Holidays Act 2003, s 18(1)]. The employer must consider the employee's wishes and ensure the employee can genuinely use the holidays for rest and recreation [Source: Holidays Act 2003, s 18(2)]. If an agreement cannot be reached, the employer and employee must try to reach an agreement [Source: Holidays Act 2003, s 18(3)].

When an Employer Can Require Annual Leave to be Taken

An employer may require an employee to take annual holidays in specific situations. This power is outlined in the Holidays Act 2003 and is subject to certain conditions:

  1. No Agreement Reached: If an employee and employer cannot agree on when annual holidays are to be taken, the employer may determine when the employee must take their holidays [Source: Holidays Act 2003, s 19(1)]. In such a case, the employer must give the employee at least 14 days' notice of the requirement to take annual leave [Source: Holidays Act 2003, s 19(1)].

  2. Annual Close-Down: An employer may also require an employee to take annual holidays during an annual close-down period [Source: Holidays Act 2003, s 29(1)]. An annual close-down is a period, typically around Christmas and New Year, when a business temporarily ceases or significantly reduces its operations. This close-down period must be for at least 14 consecutive days (including weekends and public holidays) [Source: Holidays Act 2003, s 29(2)(a)]. The employer must give employees at least 14 days' notice of the requirement to take annual leave during a close-down [Source: Holidays Act 2003, s 29(3)].

    • For employees entitled to annual leave: They must take annual leave during the close-down [Source: Holidays Act 2003, s 29(4)].
    • For employees not yet entitled to annual leave: If an employee has not completed 12 months of service and is not yet entitled to annual leave, the employer may require them to take unpaid leave during the close-down. Alternatively, the employer and employee can agree that the employee will take annual leave in advance or another form of paid leave [Source: Holidays Act 2003, s 29(5)].

Payment for Annual Leave

When an employee takes annual leave, they must be paid their ordinary weekly pay or their average weekly earnings, whichever is higher [Source: Holidays Act 2003, s 21]. The calculation of this pay is designed to ensure the employee is no worse off than if they had worked.

Resolving Disputes

Any disputes regarding annual leave, including an employer requiring leave to be taken, may be resolved through the dispute resolution mechanisms outlined in the Employment Relations Act 2000. These mechanisms include mediation services provided by the Ministry of Business, Innovation and Employment (MBIE), and if necessary, the Employment Relations Authority or Employment Court [Source: Employment Relations Act 2000, Part 9]. An employment agreement is a contract between an employer and employee that sets out the terms and conditions of employment, and it should align with the provisions of the Holidays Act 2003 and Employment Relations Act 2000.

When to Seek Independent Legal Advice

Individuals seeking to understand their specific rights and obligations regarding annual leave, or facing a dispute with their employer, are advised to consult official government resources and organisations. Community Law Centres throughout New Zealand offer free legal advice and assistance on employment matters, including issues related to annual leave. The Ministry of Business, Innovation and Employment (MBIE) provides mediation services for employment disputes.

Key Resources