The move is welcomed by the New Zealand Public Service Association secretary Kerry Davies who said lack of leave had seen workers "battling on" and "coming into work" when unwell.
"The doubling of statutory sick leave entitlement from five days to 10 will make a huge difference to hundreds of thousands of working people.
"Covid has shown us very clearly how important it is to stay home and recover when we are unwell."
Davies said the increased leave would be of direct benefit to parents and families with dependents who were injured or sick and needed care.
"Being able to take sick leave, rather than annual leave, means people can use annual leave for its intended purpose - rest, relaxation and recuperation."
The importance of using the correct leave for time away from work was echoed by the head of a large recruitment agency.
A recent survey by Frog Recruitment found more than half of New Zealand workers were choosing to work from home when feeling unwell instead of using their sick leave.
The survey found 56 per cent of respondents said they used their work-from-home privileges instead of their sick leave entitlements when feeling under the weather.
Of the more than 250 surveyed, 28 per cent said they have taken more sick leave due to having Covid-19 symptoms since the first lockdown.
Shannon Barlow, Frog Recruitment managing director, said employees continuing to work from home when sick was coming at a high price for employers.
"Ultimately there's a huge cost to the employer when the wrong leave pass is redeemed.
"Sick leave accrues for employees who are in fact sick, but choose to work from home away from their colleagues."
Barlow said the survey revealed a grey area for employers managing their workforce's sick leave, despite the new model of adapting to flexible work policies being largely beneficial for employers and employees.
"Our best advice is to be fair to your employer and transparent with your manager - if you're using work-from-home privilege to hibernate at home because your throat is scratchy, then inform them.
"Reasonable managers will agree that if the throat tickle develops into a more sinister cold, then it is time to activate your sick leave. That's what it's there for."
Barlow said the information they were getting from clients was that they were seeing an increase in sick leave since 2020 due to mental health problems.
Main points
* Both full and part-time employees accrue 10 days leave
* Employees can use the leave to care for a sick or injured partner, child or dependent.
* Sick pay is paid at a rate equivalent to what the employee would have been paid on the day they are off sick.
* An employer can ask for a medical certificate if the period of absence is three days or more.