Holiday Act Compliance (HAC) project

The Ministry of Business Innovation and Employment's (MBIE) Labour Inspectorate audited the 20 organisations then known as 'district health boards' (DHBs) and found non-compliance with the Holidays Act 2003 at several DHBs.

DHBs generally, including the one that has since become Te Whatu Ora - Health New Zealand Hauora a Toi Bay of Plenty, acknowledged that there had been non-compliance and agreed that payroll systems needed to be improved (rectified) and any underpayments paid to employees remediated.

A memorandum of understanding (MOU) between MBIE, DHBs, and the unions was developed and signed.

Under this MOU, we are reviewing and rectifying the payroll system and undertaking a remediation process.

The agreed solution between the unions and all DHBs (including the organisation that has since become Te Whatu Ora - Health New Zealand Hauora a Toi Bay of Plenty) is to make remediation payments to current and former employees to adjust for any incorrect calculations dating back to May 2010, and for future payments to be calculated and paid correctly in line with the agreed MOU.

Te Whatu Ora - Health New Zealand Hauora a Toi Bay of Plenty is approaching this task using the 'Framework for Local DHB Holidays Act Review' document developed under the agreed MOU.

The unions are represented in a steering group and project team set up to oversee the process.

There are three key phases.

1. Review - this involved testing our payroll systems against a 'baseline interpretation' agreed by DHBs and unions to identify the extent of non-compliance. It was completed in September 2020.

2. Rectification - fixing any identified issues of non-compliance with holiday pay payments and applying processes to ensure future payments comply with the Holidays Act 2003. This phase is currently underway.

3. Remediation - calculating and paying any amounts owing to current and former employees arising from any identified non-compliance. There will be a national process for former DHB employees (e.g. those who worked for us at any time since 1 May 2010) to register.

Every employee and former employee's payments back to 1 May 2010 have been reviewed as agreed under the MOU.

The review indicated there may be about 4000 former BOPDHB (Te Whatu Ora - Health New Zealand Hauora a Toi Bay of Plenty) employees affected, and about 3800 current employees who may be affected. Potential impact on employees will vary depending on their work patterns.

Any payments will be made as part of the remediation process, which is in phase three of this project. It is absolutely vital that we get it right, and the complexity of achieving this is significant.

The team is working through all the payments while ensuring the systems and processes are aligned to the MOU in future.

If there are any historical overpayments related to holiday pay, no action will be taken to reclaim the money.

The emphasis is on Te Whatu Ora - Health New Zealand Hauora a Toi Bay of Plenty paying out what people are owed.

However, this process will help us to identify if there are any risks of overpaying people, and we will correct this for future payments.

We will keep this page regularly updated on progress as we move through the three phases of the process outlined above.

If you are a current employee, we don't need you to do anything. If you are identified as being owed money, we will already have your account details. You will receive a statement outlining the adjustments once we have calculated them. We will also tell you anything else you need to know about the payments.

As part of the remediation phase, we will make employees aware of possible impacts on tax brackets, allowances, student loans, tax payments, superannuation etc.

We will be asking for your help to let former employees know about this, if you are in contact with them.

Former employees who worked for the BOPDHB (Te Whatu Ora - Health New Zealand Hauora a Toi Bay of Plenty) any time from 1 May 2010, will be able to register their up-to-date contact details on a national website.

That website will be well-publicised, and a link will be placed on this page as soon as it is available. It will include FAQs for former employees.

We will make reasonable efforts to contact any former employee who is owed a payment, whether or not they have provided their up-to-date contact details.

Current employees DO NOT need to register on the national website, unless they have worked for another former-DHB since 1 May 2010.