Health board staff may be owed $65m in holiday pay

An estimated $65 million in holiday pay may be owed to Canterbury District Health Board staff.

Provisional estimates, based on a series of assumptions, have led the CDHB to this figure.

However, the estimates need to be “tested in detail” and nothing has been confirmed yet, CDHB chief people officer Michael Frampton said.

In 2016, an audit by the Ministry of Business, Innovation and Employment discovered many organisations were miscalculating pay of annual leave and holiday pay, which was not fully in line with the Holidays Act.

Earlier this month, Christchurch City Council revealed it is conducting a similar review of its holiday pay.

An external adviser has estimated a cost of $5.6 million for the review and any potential back payments to staff.

Environment Canterbury also commissioned an audit of its holiday pay, which was completed by the New Zealand Payroll Practitioners Association.

Less than $100,000 was paid out to about 37 staff, ECan director finance and corporate services Miles McConway said.

"There was one minor change in allowances that needed to be made. This has been actioned.

"Shortcomings were identified with the payroll software and assurance has now been obtained that it is compliant with the Act,” he said.

The 20 DHBs across NZ have agreed to a national approach to review, rectify and remediate about 100,000 staff affected by a misinterpretation of the Holidays Act 2003.

Last year, it was revealed the DHBs owed an estimated $550 million to $650 million in total in pay since 2010.

Mr Frampton said the national approach by all DHBs is being dealt with in three stages.

Stage one is a comprehensive review of existing systems and working practices to identify areas that may not comply with the Holidays Act, and stage two involves fixing issues identified to ensure ongoing compliance.

"The third and final stage is remediation, where we determine the impact non-compliance may have had on individual employees.

"Until we reach this final stage, it is not possible to confirm with a high level of confidence the financial impact or the number of people affected.

“Canterbury and West Coast DHBs, along with our union partners, are committed to ensuring any compliance issues are fully understood and rectified before individual payments are made,” he said.

Mr Frampton said the CDHB is working with “focus and urgency” to complete the work.