The government is moving to pass a law to double sick leave from five days a year to 10

The government will begin the process of granting each New Zealander an additional five days of sick leave per year before Parliament suspends its summer sessions.

Prime Minister Jacinda Ardern said the move shows that the government is getting “down to business” when it comes to implementing its pre-election policies.

In addition to the new sick leave rules, Ardern has revealed that the government will present legislation today to implement a new law with a maximum tax rate of 39%.

That’s after she has tabled a motion to declare a climate emergency, a motion very likely to pass in the Labor and Green-dominated House.

The government also announced this morning that it will expand its debt hibernation plan for small businesses.

But the focus of Ardern’s weekly post-Cabinet press conference was primarily on the new sick leave legislation.

Although the new rules are backed by unions, business groups are not happy.

Retail NZ said the widespread increase to 10 sick days a year is “bad news” for those who work part-time.

And National labor relations spokesman Scott Simpson said more sick leave “would only ruin our economy.”

“Doubling sick leave just adds up to more costs for companies at a time when they can least afford it, in addition to increases in the minimum wage and the proposed additional holiday,” he said.

Workplace Relations Minister Michael Wood, who was with Ardern in yesterday’s announcement, said New Zealand needs to “leave behind the culture of toughness” when it comes to sick leave.

“Covid-19 has shown how important it is to stay home when people are sick,” he said.

Doubling the amount of sick leave for workers was one of Labor’s pre-election promises.

Wood confirmed that the legislation, to be introduced before Christmas, will keep the current maximum entitlement to any unused sick leave at 20 days a year.

The announcement means the bill is expected to pass in mid-2021 and will go through the full selection committee process so it can receive submissions.

This will not be good news for the Greens, who have previously said they want the bill to pass urgently before the end of the year.

More details on the plan will be released when it comes before the House.

Wood said, however, that the Ministry of Business, Innovation and Employment has calculated that it would account for only 0.9 percent of New Zealand’s total wage bill each year.

Retail NZ CEO Greg Harford said doubling the number of sick days for part-time and full-time workers will ultimately hurt those who want to work part-time.

He said that many of those who work part-time often do so for family commitments or study.

For employees who work one day a week, for example, a 10-day sick leave entitlement equals 20 percent of a work year.

“This is a significant cost to employers and will ultimately discourage companies from offering part-time work to those who want it.”

Meanwhile, the government has also announced that it will extend the corporate debt relief program for another 10 months.

That scheme meant that companies affected by Covid-19 can hibernate their debt for a period of time so that they can more easily recover.

Although New Zealand is recovering better than expected, Finance Minister Grant Robertson said some companies need continued support to continue operating.
The scheme has been extended until October 31, 2021.

“This is intended to give companies time to explore options to continue operating, when they might have otherwise been liquidated by their creditors,” Robertson said.