Hundreds of thousands of workers are set to lose 25% of their leave.

Source: Unite union 24/09/2025

As feared, the proposed Holidays Act changes look likely to reduce both holiday and sick leave for hundreds of thousands of low paid part-time employees.

Brooke Van Velden herself admits that workers who increase their regular hours over time will lose out on annual leave. Those who decrease their hours will only be marginally better off, as the current law protects their pay for up to a year after.

For example,  Kayla starts a permanent job working 20 hours a week in January and increases it to 40 hours in July. If they take their 4 weeks leave at Christmas they currently get 160 hours worth of pay for the 4 weeks. 

Under the new proposals they will only have accrued 120 hours worth of leave - a massive 25% reduction in leave. That is not a hypothetical. As the billions paid out to workers who were short paid in the past shows, it is a very common scenario, especially for low paid workers.

Sick leave will be directly reduced for hundreds of thousands of workers. 40 hours a week as the standard is a distant memory in many sectors - particularly in hospitality and other precarious jobs. Work visas only require 30 hours and many official definitions of “full time” employment use 30 or 32 hours as the cut-off. Anyone working 32 hours will lose 20% of their sick leave. The irony is women will be overwhelmingly impacted by this, despite being far more likely to use leave to look after dependents. They need more access to sick leave, not less.

The minister is making much about employees being able to take leave from the start of employment. In reality most of our members are already allowed to take annual leave from day one, as employers seek to reduce leave liability on their balance sheets. Employers also have to agree to each leave application, so there is no guarantee of workers actually being able to take the leave when you want in any case. Unite Union National Secretary Shanna Olsen-Reeder says "Once again Brooke van Velden is showing her true colours by slashing the entitlements of the everyday worker, this is a desperate attempt at pushing through her own agenda before the next election where her extreme views are likely to cause her to be stripped of her role as Minister of Workplace Relations."

The proposal to pay out overtime and additional hours rather than accrue leave is also a huge concern. For most of our members, and hundreds of thousands of other workers, the contracted or guaranteed hours are much less than they actually work on average each week. Differences of 50%, 100% and even 200% are not uncommon. That means workers will need to put aside money each week to be able to afford to actually take leave. In a cost of living crisis this puts even more financial pressure on workers.

For example Christina is contracted and guaranteed 15 hours a week, but regularly works more - averaging 30 hours. Unless they save money each week, when they go to take annual or sick leave, they will only have half their regular income available. When low paid workers are struggling to pay the bills week to week as it is, the outcome will inevitably be workers not being able to afford to take the leave. That means coming to work sick or cashing out leave rather than taking much needed holidays. 

The proposed changes also make swapping your annual leave for cash that much easier to do. Currently you can only cash out one week of the four weeks minimum leave each year. Allowing 25% cash-outs of total balances means workers who have not been able (or allowed) to take annual leave will end up pressured into just getting paid out, sparing the employer the inconvenience of finding cover. 

It is outright irresponsible and frankly dangerous for the Minister of Workplace Relations and Safety to create a scenario where workers are unable to prevent the spread of illness, or for them to take time out to rest away from their jobs.

For more information contact:

Gerard Hehir | Assistant Secretary, Unite Union

Email: gerard@unite.org.nz,  Phone: 021 029 40345