This note is not part of the order, but is intended to indicate its general effect.

This order, which comes into force on 5 April 2013, modifies and extends the operation of the Sleepover Wages (Settlement) Act 2011 (the Act) to give effect to a settlement of litigation between Hohepa Homes Trust Board (the specified employer) and certain of its employees. The litigation relates to the payment of wages to employees who were permitted to sleep overnight at their workplace while on duty (sleepover wages).

The Act implements a settlement of similar litigation between Idea Services Limited and Timata Hou Limited and their employees (the Idea settlement). Subpart 1 of Part 2 of the Act extinguishes certain claims for sleepover wages in the health and disability sector, and subpart 2 of Part 2 of the Act implements the terms of the Idea settlement.

Subpart 1 of Part 2 of the Act already applies to the specified employer, because it applies to all employers in the health and disability sector funded through Vote Health. It extinguishes claims relating to sleepovers performed before the Act commenced, if those claims were lodged after 5 pm on 2 September 2011. Claims filed before that time are preserved. Section 9 of the Act extinguishes claims by employees of Idea Services Limited and Timata Hou Limited for sleepover wages, including those that would otherwise have been preserved. Clause 5 extends the effect of section 9 of the Act to employees of the specified employer and will have the effect of extinguishing existing claims for sleepover wages that were lodged by its employees before 5 pm on 2 September 2011.

Clause 6 extends the effect of subpart 2 of Part 2 of the Act (which implements the Idea settlement) to the specified employer and its employees, but with certain modifications that are set out in clauses 7 to 10.

Clause 7 modifies section 19 of the Act, which sets out how back wages for sleepovers must be calculated. The formula in section 19 involves multiplying the applicable minimum hourly rate by 9, which represents the number of hours of a sleepover performed by employees of Idea Services Limited and Timata Hou Limited. The formula in section 19 is amended so that the applicable minimum hourly rate will instead be multiplied by 10 to represent the number of hours of a sleepover performed by employees of the specified employer.

Clause 8 modifies section 20 of the Act, which sets out when back wages must be paid. It provides that back wages due to employees of the specified employer must be paid no later than 2 months after the date of commencement of this order.

Sections 21 and 22 of the Act provide for a staged progression towards the minimum hourly wage payable under the Minimum Wage Act 1983. Clause 9 modifies section 21 of the Act, which sets out an employee’s entitlements for sleepovers performed between 1 July 2011 and 17 October 2011 (being the date immediately before commencement of the Act), and when those entitlements must be paid. The modification provides that the amount payable to employees of the specified employer for sleepovers performed during this time is either an amount calculated in accordance with transitional formula 1 (defined in clause 4) or the amount the employee would have received immediately before the date of commencement of this order, whichever is greater. Transitional formula 1 reflects the agreement reached between the parties. It differs from the formula set out in the Act for calculating the wages payable for sleepovers performed during this period in 2 respects as follows:

• it uses a variable to reflect the number of hours in the sleepover:

• the order in which the operations are performed produces a lower result.

Clause 9(3) provides that the amount payable for sleepovers performed in the period between 1 July 2011 and 17 October 2011 must be paid no later than 2 months after the date of commencement of this order. Section 28(c) of the Act permits this modification of the date on which payment is due only if the relevant Minister is satisfied that the proposed period has been agreed to by a simple majority of the employer’s employees. The Minister has indicated that he is so satisfied.

Clause 10 modifies section 22(1) of the Act, which sets out how sleepover wages are to be calculated for sleepovers performed after commencement of the Act by those employees to whom subpart 2 of Part 2 of the Act applies. The section implements a staged progression towards payment of the full minimum hourly wage payable under the Minimum Wage Act 1983. The effect of clause 10 is to modify the staged progression set out in the Act in the following ways:

• the period of time during which an employee of the specified employer may be paid at less than 100% of the applicable minimum hourly rate is extended to the close of 30 June 2013:

• for sleepovers performed in the period from 18 October 2011 to 30 June 2012, an employee of the specified employer must be paid an amount calculated in accordance with transitional formula 1 (defined in clause 4), rather than in accordance with the Act:

• for sleepovers performed in the period from 1 July 2012 to the day before the date that is 2 months from the date on which this order comes into force, an employee of the specified employer must be paid an amount calculated in accordance with transitional formula 2 (defined in clause 4), rather than in accordance with the Act:

• for sleepovers performed between the date that is 2 months from the date on which this order comes into force and the close of 30 June 2013, an employee of the specified employer must be paid 75% of the applicable minimum hourly rate:

• if, before the commencement of this order, an employee of the specified employer would have received an amount greater than that specified in this order, he or she will be entitled to be paid that greater amount.