Q: I just have a question for you, during my consulting work I have had a few New Zealand businesses. The one thing I find as the common issue is leave accruing and being paid in hours. I just wanted to get an idea from you as to how they would rectify this issue to be complaint.
Would they need to reconcile all their leave going back for a certain period of time? Would they just need to change it going forward?
A: There is no issue in using hours as long as it has been agreed between the employer and employee and the hours reflect the week for the employee. The issue is the employment agreement states weeks but the payroll system does hours or days and there is no agreement to use them so that then creates the noncompliance issue.
The other side is when the week cannot be defined because the employee works variable hours and you find the payroll system (smaller systems) doing things such as proportional accrual (4/52) for every hour work that creates a bucket of time but does not help in defining the week and creates non compliance again.
A week is by agreement so when the week changes by agreement any entitlement must be converted to the new week.