When an employee is injured, they may need time off work to recover. This guide describes:

• Your obligations to allow sick leave under the Holidays Act and in accordance with any employment agreement;
• Your obligations to provide a safe workplace under the Health and Safety at Work Act,
•  Your obligations under the ACC regime. 

General employment law obligations:

If an employee gets injured they may be unable to work.  You should have clear policies in place about how employees are to notify you if they are unable to work, and how they can apply for sick leave.

Most employees are entitled to a minimum 10 days of sick leave per annum (after becoming entitled to sick leave), and this can be accumulated up to 20 days.  Some employees may be entitled to additional sick leave, based on what is recorded in their employment agreement.  It is therefore important to check any agreement if you are unsure.

If an employee has no sick leave available (or has used it up), an employer can agree to let their injured employee use sick leave in advance, to use their annual leave entitlements, or to take unpaid leave.

Employers must keep accurate record about wages, time and leave, so that they know how many days of sick leave their employees have available and how many days have been used.

It is important to make sure that you can still meet your business needs while the employee is recovering.  This could be by way of delegating the employee’s work out to other existing employees, or by employing a temporary worker to help out for a set period of time.  You should consider how other employees will be impacted by the absent employee (for instance their work load may increase beyond a reasonable level).

Once the employee has recovered, you are obliged to let them return to their usual duties, and to pay them their usual wages (unless they are returning to work in a reduced capacity).

Breaching the minimum entitlements of an employee, or failing to keep accurate records, can lead to costly penalties and personal grievances. 

Obligations under the Health and Safety at Work Act: 

Employers have to provide a safe workplace (whether that be a business premise, or the employee’s home if they are working from home). 

Employers must identify hazards in the workplace and put in place processes to eliminate or minimise the risk from those hazards.  This includes putting in place accident registers, providing safe equipment, training employees, and providing personal protective equipment (PPE).

Employers should also ensure that their employees are familiar with these processes and that adequate training is provided to them on the role they play in keeping themselves and others safe from harm while at work.

If an accident does happen in the workplace, this should be noted on the accident register (if less serious) and notified to WorkSafe (if serious). 

Employers must take their obligations seriously under the health and safety laws, as penalties and prosecutions can result and the fines imposed are very high, even for seemingly lower level breaches. 

Obligation under the Accidence Compensation Corporation Act:

If an employee is injured at work you will need to pay them 80% of their wages for their first calendar week off work (or part week). 

If the employee was not injured at work, you will not be required to pay 80% of their wages, but the employee could instead apply to use their sick leave (if they have it available). 

After the first week of an injury, ACC will pay the employee 80% of their wages until they can return to work.  An employer can agree to top up their employee’s wages out of their own pocket or by letting the employee use some of their sick leave or annual leave.

Employers can agree to sign an Employer Reimbursement with ACC, who will then calculate the payments due to the effected employee/s, but the employer will pay the employee directly on ACC’s behalf.  The employer will then be reimbursed periodically, or at once, as the case may be. 

You may be required to provide certain information to ACC, including about the employee’s wage, time and leave records, and also about your IRD number.

The employee should keep you informed about their progress towards recovery, but if they do not, you should check in with them to make sure that you can plan ahead for your business’s needs.  If the employee will likely recover fully in a reasonable period of time, you may be able to delegate their work to existing employees.  You will need to be careful not to overload existing employees.

If an employee will be off work for more than 7 days, they will have a recovery team assigned to them.  You and your employee may need to have discussions with the recovery team and the relevant health care providers about the nature and extend of the injury and recovery time, and how you can support the employee to return to work (if at all). 

It may be necessary for an injured employee to return to work gradually, or to return to work permanently in a different role.  You should keep ACC informed about any work that the employee is doing and you should also pay them accordingly.  ACC will continue to pay what is required to top the employee up to 80% of their pre-injury wages. 

If it is not clear whether, and to what extent, an employee will be able to return to work, ACC will pay for an assessment to be done by an occupational therapist.  The occupational therapist will prepare recommendations around what tasks the employee could safely do, how long for, and/or what support and modifications to the work environment could be helpful, and so on.  

It is possible to let an employee trial a return to work, at little risk to your business.  ACC will continue to pay 80% of their wages, while you assess whether the employee can safely return to work.

What if the employee does not fully recover from their injury?

If an employee does not recover completely from their injury, you could agree to allow them to come back to work in a reduced capacity (for instance in a different role, or with reduced hours).  It is a good idea to record any agreed changes to work terms in writing.

If you cannot keep your employee’s role open for them while they recover from their injury, you may need consider other options like hiring a temporary replacement employee.  This is a good idea if you have concerns about existing employees being otherwise overloaded, or if your business will not be able to operate efficiently without someone in that role. 

If it becomes clear that the employee will not be able to return to work at all, or if you cannot keep their role open until they do recover, you may need to consider terminating their employment due to medical unfitness. This should be a last resort, after alternatives have been considered. For more details about the process you should follow in this case.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.