New Zealand 10 Days Sick Leave Entitlement

The steps below will assist you in making sure that you set up your employee's leave settings according to the new New Zealand legislation change from 5 days to 10 days sick leave entitlement per year.

Parliament has passed the Holidays (Increasing Sick Leave) Amendment Bill to increase the minimum employee sick leave entitlement from 5 days to 10 days per year.

Most employees who have worked for an employer for six months or over are entitled to sick leave if they, or a dependent, are sick or injured. Currently, employees are entitled to 5 days of sick leave per year; however, from 24 July 2021, this will increase to 10 days per year.

Employees will get the extra five days when they reach their next entitlement date – either after reaching 6 months’ employment or on their sick leave entitlement anniversary (12 months after they were last entitled to sick leave).

Employees who already get 10 or more sick days a year will not be affected by this change.

The maximum amount of unused sick leave that an employee can be entitled to will remain 20 days.

More information.


To set this up in Reckon Accounts, follow the steps below:

Note: Leave varies per company; please use this as your guide. The leave multiplier may differ as per company has its way of calculating leave entitlements. In this example, we use the leave entitlement in hours equivalent and accrue on the anniversary date (6 months or over), whichever is applicable.

Setting up Personal Leave or Sick Leave

Click the images for better viewing.
  1. Open the employee records, Click the Employee Centre > under the Employees tab on the left > double-click the employee name.
  1. Choose Payroll and Compensation Info in the Change tabs list.
  1. Click the Leave Details button > make sure that you are in the Personal Leave Tab.
  1. Leave Details

Example calculation:

Weekly: 8 hours/day 

Leave entitlement: 10 days / year

8 x 10 = 80 (Enter this value in the Hours accrued at beginning of year)

Existing and New Employee Settings

  • Hours available as of (Date):

* Leave the field blank for new employees - it will accrue the 80 hours (10 days) entitlement on their 6 months of over anniversary date

* Existing Employee: leave whatever value in the field

  • Hours used this year:

* Leave the field blank for new employees

* Existing Employee: leave whatever value in the field

  • Accrual period: "Beginning of year" - since NZ leave entitlement is after 6 months or over.
  • Hours accrued at beginning of year: 80

* New and existing Employee: Enter 80

  • Maximum number of hours: 20 days x 8 hrs = 160 (Maximum leave accruals as per NZ legislation)
  • Reset hours each new year? - This will depend on the company policy leave policy
  • Year begins on: Enter the Month of which the employee will be 6 months or over.
  • Day: Enter the Day of which the employee will be 6 months or over.
  • Begin accruing time on: (Day/Month/Year) which the employee will be 6 months or over.
  • Leave Liability: usually, this should be ticked - but double-check from the company
Note: The settings below should be the same as it won't accrue the correct hours when the employee reaches their 6 months or over leave entitlement.
  1. Save the changes, and you are now ready to process your payrun. 

 

Following this calculation will ensure that:

  • New employees will get their 10 days entitlement after 6 months or over.
  • Employees will get the extra five days when they reach their next entitlement date – either after reaching 6 months' employment or on their sick leave entitlement anniversary (12 months after they were last entitled to sick leave).



Video Reference: (How to set up Leave for NZ) - or if you are playing the video from the beginning you can Skip the video to 27:27.

The video shows the 5 days leave entitlement for NZ, but the settings are all the same. The only difference is the Hours accrued at beginning of year where it should be 80, not 40.

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