CTU holiday back pay background information

  • Wide-spread payroll errors have led to a situation where, according to Government figures, New Zealand workers are collectively owed up to $2.3bn in unpaid leave payments going back six years.
  • The Government was aware of the scale of this situation two years ago but hasn’t done enough to fix it.
  • CTU Affiliates have been aware of the issue in a few sites and have negotiated audits and settlements in some, but until seeing the Government figures had no way of knowing the scale of the issue.
  • This is too big to fix on a case by case basis. It needs Government to work with unions and business to find a high-level solution.
  • In the meantime the statute of limitations means New Zealand workers are collectively losing up to a million dollars a day in back pay as their right to it expires.
  • That’s why today we are proposing that this limit is urgently suspended so that New Zealanders don’t continue to lose money while the problem is fixed.
  • In order to do this we have produced a Bill for the Government that stops the clock on the statute of limitations and are asking that they pass it under urgency.
  • We are confident that the Government will get support for the Bill across the house to do so.
  • The Government have the opportunity to stop New Zealanders losing a million dollars a day and to create space to fix the payroll problem so that money goes to the Kiwi workers who are owed it.
  • The Government can take this important first step next week when the house sits. It’s up to them.

Pertinent Facts:

  • Several employers that affiliates have discussed this with have agreed to payroll audits, and at least one has negotiated a back-pay settlement with union members – in that case $17,000 in back-pay was paid to 70 workers.
  • We have identified this problem across the workforce – from health, to fast food, to ministries – including MBIE – and other employers.
  • This is not a reason to change the Holidays Act – not all payroll providers have been calculating leave incorrectly.
  • Exemptions to the Limitations Act are not unusual – there are already ten in place covering matters including rent arrears, and interests in trusts.
  • The Government kept the scale of this problem secret for two years – this delay alone will have cost New Zealanders up to half a billion dollars.

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