Employees are entitled to sick leave (paid time off work) if an employee, their spouse, partner, dependent child or other person who depends on them is sick or injured. All employees (including part-time employees) are entitled to five days’ sick leave if they have six months’ current continuous employment with the same employer or if they have worked for the employer for six months for an average of 10 hours per week and at least one hour in every week or 40 hours in every month. This is known as ‘the work test’.
For each 12-month period after meeting the above, each employee gets at least five days’ sick leave.
If at any time in the future there’s a period when their employment is not continuous, or they don’t meet the work test, then they’ll have to requalify for entitlement to sick leave. The employee will not lose any existing unused sick leave that they’re entitled to.
Casual employees could also be entitled to five days’ sick leave after six months’ employment if they have worked at least 10 hours per week on average over that six-month period and no less than one hour every week or 40 hours every month. If in any year the casual employee doesn’t meet the criteria, then they don’t get any new sick leave entitlement; however, they can use their sick leave balance which may have carried over. An employee may requalify for sick leave as soon as they meet the criteria.
Sick leave entitlements are not pro-rated in any way. For example, even if a part-time employee only works three days a week, they still get five days’ sick leave a year and can accumulate up to 20 sick days a year.
Unused sick leave entitlement can be carried over to the following year (maximum thresholds apply). Unused sick leave is not paid out upon termination of employment (unless provision is included in the employment agreement). Cash benefits for temporary incapacity to work, otherwise known as sick pay, compensate for lost income from the employee’s salary when they must take absence due to temporary incapacity to work.
The maximum amount of sick leave that can be accumulated under the Holidays Act 2003 is 20 days. However, the employer and employee can agree that sick leave can accumulate to more than 20 days in the employment agreement or through workplace policies.
A bill was introduced to Parliament on 1 December 2020 and is currently before the education and Workforce Select Committee to increase employees’ minimum entitlement to sick leave from five days to 10 days per year. If these changes come into force, an employee would first become entitled to 10 days’ sick leave on their next entitlement date. This means that employees who have not worked for their current employer for six months when the law comes into force will receive 10 days’ entitlement as soon as they become entitled to sick leave. Employees who already have a sick leave entitlement when the legislation comes into force will become entitled to 10 days’ sick leave on their next entitlement date. (That is, on the 12-month anniversary of when they last became entitled to sick leave.)