HR Practice For Payroll Practitioners

HR Practice for Payroll Practitioners

Not returning to work from ACC

If an employee has suffered an accident (workplace or non-work accident) that could be an injury or illness, it can mean that the employee is covered under ACC (ACC will confirm this). This situation can mean that the employee will be off work for a long period of time, which could lead to the employee deciding to resign.

For termination pay based on the employee being on ACC at the time of termination, payroll needs to apply the following:

• The time on ACC is considered part of continuous employment under the Holidays Act (Section 16), so annual holiday entitlement could have been earned (if the employee entitlement date was reached) and will need to be paid out on termination. • Any annual holiday entitlement paid out on termination will extend forward the termination date, so any public holidays in the extended period will also be paid.

• The notice period won’t be worked if the employee is on ACC, so it could be paid in lieu.

• Any payment paid on termination will also be part of the 8% on termination.

© New Zealand Payroll Practitioners Association, Sep 2024, Ver 12

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