15 May 2017

'Vast majority' still missing holiday pay - CTU

6:13 am on 15 May 2017

More time is needed for a potential $2 billion salary problem to be fixed, the Council of Trade Unions (CTU) says.

That is the maximum assessment of money owed to workers who have been denied the holiday pay they are entitled to.

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Photo: 123rf

The low end of the assessment is still hundreds of millions of dollars, and all parties admit they do not know where the exact figures lie.

But time is running short to answer that question.

The problem stems from payroll systems that are not up to the task of assessing holiday entitlements for people whose work is variable.

These people do shift work, overtime, statutory holidays, or get short bursts of extra money from temporary promotion.

It can lead them to get less holiday pay than they are entitled to.

No one knows just how many workers are missing out, or by how much.

CTU legal counsel Jeff Sissons said more research was needed.

"A vast majority of working people are missing out," he said.

"What is not clear is how much they are missing out on. However we know it is a big problem and we know that the Labour inspectorate is hopelessly overmatched in sorting this out."

Mr Sissons said because the size of the problem was unknown, more time was needed to solve it than the six years currently allowable under a statute of limitations.

Progress on the matter has been glacial so far - with the exception of the police, who got $37 million in backpay.

Figures from the Ministry of Business Innovation and Employment showed from 2012 to 31 March this year, just $4.5m have been been paid in arrears to 9500 workers.

Caucus run 21/07/15

Photo: RNZ / Alexander Robertson

The Labour Party's associate finance spoksman David Clark said this level of progress was abysmal.

"This means that less than 5 percent have been paid back by the governmment's best estimate, and by other estimates, less than 1 percent of workers have been paid back so far."

Dr Clark blamed government hesitation for some of the problem, and legislative confusion for the rest.

But the Minister for Workplace Relations Michael Woodhouse said it was not the government's fault.

"While the Labour Inspectorate is clearly doing some audit work on the Holiday's Act, employees do not need to wait for the Labour inspectorate to investigate if they feel they are not being paid correctly," he wrote in a statement.

"Employees need to take this up with their employer and if their employer does not respond appropriately, a complaint can then be laid with the labour inspectorate."

Immigration Minister Michael Woodhouse

Workplace Relations Minister Michael Woodhouse Photo: RNZ / Claire Eastham-Farrelly

Meanwhile Business New Zealand employment expert Paul Mackay said the fact so few people had come forward to claim money suggested few were really owed it.

"Because of the lack of angst for over a year, you would have to wonder whether or not the issues that have been uncovered are the majority," he said.

"That is not to say that there are not further ones, but we don't really know.

"Until either audits are done or people have complained it is hard to extrapolate from what we already know that there is a national problem."

The problem was made worse by varying estimates.

Figures from the Ministry of Business, Innovation and Employment in 2014 varied from 194,700 workers to 763,350.

The money payable varied from $292m to $2.2bn.

And the money owed per worker ranged from $250 to $500.

Compounding the lack of knowledge, the ministry said it could only add up the figures as successful claims came in, and it had no idea of what the final number would be.

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