I am sure for some people just reading/hearing the word “leave” seems like a bit of a pipe dream some days. Well, as wonderful as it sounds, it is also very important. The benefits of taking leave promotes good physical and mental health in the workplace and improves people’s work-life balance, which reduces stress and unscheduled days off.

Let me tell you why it is essential for us to take leave: 

  1. It is the Law!

By keeping accurate track of leave and pay, you are protected under the Holidays Act 2003. Under the Holidays Act 2003, all employers must keep accurate records of the daily hours every employee works and the pay for those hours, as well as the leave accrued, entitled leave, and leave taken. Examples of leave type are:

  • Annual leave (at least 4 weeks a year after each 12 months of employment);
  • Public holidays (up to 11 holidays each year, if they are days they would normally work);
  • Sick leave and bereavement leave (typically after 6 months of employment);
  • Parental leave (a mix of paid and unpaid leave depending on eligibility).

As we’ve seen in recent years, calculations for annual leave payments have caused quite a few headaches for Kiwi businesses. Many companies, both big and small, have been caught out underpaying employees for leave.

Accurate tracking of leave will also keep you safe from a fine from the Employment Relations Authority (ERA) or a Labour Inspector and ending up in the news!

  1. Cost reduction

Effective leave tracking and management can lead to a reduction in costs. Paid time-off has a significant financial impact on a company’s bottom line as well as a multitude of indirect effects. There may also be increased administration costs and management time and potential health and safety issues with replacement or overworked staff. Another financial implication of failing to properly manage leave is allowing employees to accrue weeks or months of leave, puts the business in a very risky position as it is registered as debt on the books.

  1. Proper leave and holiday planning

Suitable leave planning for your team members means you can prepare for absences in advance and ensure you have sufficient cover. While sick leave is harder to control, planning annual leave and holiday cover in advance will help reduce work disturbance.

  1. Employee confidence and well-being

By encouraging your team to take leave, the organisation is showing that it cares about its people. This means happier, more loyal and engaged people who are motivated to help the business achieve its objectives. Many good, modern leave management systems allow employees to see their leave balances and request leave electronically. This provides transparency and the automation also reduces admin for the business.

  1. Reduced absenteeism

Taking leave is essential to promote good physical and mental health in the workplace and improves people’s work-life balance. Happier, recharged people are less likely to be sick or take unexpected time off work.