An employer’s checklist for managing the Christmas – New Year holiday period

Organisations heading into the Christmas – New Year period have a long list of things ‘to do’, from managing social occasions responsibly, planning a closedown period, calculating annual holiday entitlements and practical considerations around a temporary workplace closure. DTI Lawyers has put together this simple summary to help:

Work functions

Work functions are a great opportunity to celebrate the end of the year, the team and thank those for their hard work. However, employers need to be mindful of their obligations in hosting work events, to ensure that these are managed in a safe and healthy way.

Employers have an obligation under the Health and Safety at Work Act to take reasonably practicable steps to ensure workers’ health and safety, including at work events. This requires a risk assessment, and then a plan to eliminate or minimise those risks, as far as reasonably practicable. At a minimum, employers should consider:

• Communication so that everyone knows the workplace expectations. If there are not policies in place, clear directions should be given prior to any workplace event. 
• Host responsibilities with alcohol.
• Identifying key people who are the responsible staff to oversee an event.
• Safe transport options for staff.

This interview with DTI Lawyers Employment Law Director provides further guidance: In aftermath of KPMG event, how can employers keep workers safe? | HRD New Zealand (hcamag.com)

Annual work close down

The Holidays Act (section 29) enables an employer to have an annual closedown period, which is a period that an employer customarily closes its operations and requires an employee to take leave during this time. For most New Zealand businesses, these occur most frequently through the Christmas – New Year period. 

Considerations for employers:

• A closedown may be across an entire workplace, or, part of an organisation, e.g. a manufacturing plant shuts down to enable maintenance, but maintenance and sales staff continue to work. 
• An employer must provide employees with a minimum of 14 days’ notice, and communicate clearly the dates of the closedown.
• Public holidays – this year, there are four public holidays likely to fall within a Christmas/New Year closedown period that will need to be treated (and paid) as public holidays): Christmas Day (25th December 2023), Boxing Day (26th December 2023), New Year’s Day (1st January 2024) and the day after New Year’s Day (2nd January 2024).
• If an employee is entitled to annual holidays, they may be required to take as much of their annual holidays balance as is needed to cover the closedown period. 
• If an employee does not have an annual holidays entitlement balance to cover the closedown (in part or all of the period), there are special provisions that follow in relation to payment. 

Annual holidays – accrued and entitled leave

It’s important to remember that there is a difference between accrued and entitled annual holidays. An employee only becomes entitled to annual leave every 12 months. While an employee accrues annual leave during the 12 months, the entitlement vests on the employee's annual leave anniversary date. Employees can be directed to take accrued annual leave to which they have an entitlement, i.e. it has become vested, but not ongoing accrual. An employer cannot require an employee to take leave in advance.

For an employee who is not entitled to annual holidays during a closedown (usually because they have not worked continuously for the employer for 12 months, or have been working on a ‘pay as you go’ basis), there are special provisions that apply to payment. These employees must be paid 8% of their gross earnings at the closedown date from:

• the start of their employment (if they have not worked continuously for 12 months); or,
• their last anniversary date for annual holidays less any amount already paid as you go or already taken in advance.

An employer may agree to the employee taking annual holidays in advance, but there is no obligation to do so.

What if an employee gets sick during their annual holidays?

If an employee, their partner, or dependant becomes sick or injured while on annual holidays, the Holidays Act (section 36) enables an employee to request sick leave rather than taking annual leave for this time, however, an employer is not required to agree.

What if an employee is affected by family violence or bereavement while on annual holidays?

The Holidays Act (sections 37 and 27A) provide that if an employee is affected by family violence or a bereavement while on annual holidays, an employer must allow the employee to take family violence or bereavement/tangihanga leave (if they are entitled) rather than annual leave.

Practical steps before an office closedown

Last but not least, there are many practical steps to ensure that the workplace is left in good shape without a New Year’s Hangover to return to. Don’t forget:

• Put notification plans in place and have up to date contact lists in the event of an emergency.
• Ensure workers know who to call in an emergency through the closedown/their holiday. 
• Tell others (customers and suppliers) when you will be closed.
• Plan for what needs to be shutdown and what is kept running. Any unnecessary power should be turned off. For example, servers, fridges, phones and security stay on, but computers and air-con can be shutdown. 
• Put cashflow management systems in place through the closure – pay your bills and follow up outstanding invoices prior to the closure. Be mindful about tax obligations in the first few months of the year.
• Set up voice messages and out of office messages. 
• Ensure computer and other systems are backed up.
• Clean up and empty rubbish.
• Physically secure the office and ensure any fire and other emergency measures are checked and operational.
• Marketing - a personalised thanks at Christmas to those who have supported the business over the year are always well received. Also, remember to review the website for content and any technical issues. Christmas will often bring a spike in web traffic and you don't want issues to arise when resources to address them may be limited.
• Check any stock needed for the New Year has been arranged.
• Save the plants! No one wants to return to a sea of dead plants – make a plan for office plants to be cared for during the closedown.

Christmas can be an opportunity for rest and relaxation, but also a time of heightened stress. We encourage all workplaces to be realistic with work demands throughout this period. Be mindful of good faith obligations to be active and constructive in maintaining a productive relationship, which includes communicating proactively and responsively. Clear communication, getting ahead of issues before they escalate, and working collaboratively goes a long way to mitigating stresses that can arise at this time of year.

We wish everyone a safe, happy and relaxing festive season. If you need advice or assistance on any matters raised within this article, the specialist DTI Lawyers employment law team can be contacted by phone on 07 282 0174 or email reception@dtilawyers.co.nz