A major change to how leave is calculated in workplaces is becoming law.

The Employment Leave Bill repeals the Holidays Act 2003, attempting to simplify the regime for both workers and employers.

• Annual and sick leave will be accrued in hours, rather than days.
• For additional work or casual hours, leave will not accrue - employers instead will pay a set 12.5 percent 'leave compensation payment'.
• Full- and part-time employees will be able to access annual, sick, bereavement and family violence leave from the first day of work.
• Casual workers will be able to access bereavement and family violence leave from the first day of work.
• Leave can be taken in hours, instead of requiring whole days.
• Workers will be able to cash in up to 25 percent of their total annual leave balance every year.
• Accrued leave hours are 'banked', so entitlements don't change if work hours do.
• People coming back from parental leave will be paid their usual rates if they take annual leave, rather than a lowered rate because they had not been in work for the full past 12 months.

The bill has passed its third reading and is awaiting royal assent, and is expected to come into force in two years.

What was wrong with the old act?

Employment law expert Bronwyn Heenan, from Simpson Grierson, said it was "incredibly thorny, difficult, complex and very difficult to navigate".

"Most employers don't wake up in the morning and want to not give their employees the correct holiday pay entitlements, but that was...

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