Workplace Relations and Safety Minister Michael Woodhouse said there were many reasons why a person might want to cash in a week's leave, such as financing a holiday, meeting unexpected expenses, or if a person had accumulated a lot of leave.
"The figures show several thousand people have chosen to take this option in the past year in the public service alone. However, it was never the intention that every employee would take up this option."
Iain Lees-Galloway, Labour's workplace relations and safety spokesman, said the numbers showed the change wasn't something people were crying out for.
"It obviously has the potential to be attractive to people who are struggling to make ends meet. But we would prefer to deal with that by increasing wages overall, rather than making people feel under pressure to forgo some of their holiday time.
"At a time when we are putting a lot of focus on health and safety in the workplace, I think Governments should be encouraging people to take their annual leave, to get some rest, get refreshed so they can be safer and more productive at work."
Lees-Galloway said people had a lot of demands on their time, including parents trying to juggle school holidays, and found it difficult to achieve a work-life balance.
A Defence Force spokesman said it allowed civilian and military personnel to easily apply online to cash-in annual leave.
"Other Government agencies have different systems and some require exceptional approvals on a case-by-case basis to have the payment approved. The NZDF has chosen to make it a simple, automated approval process."
Police said they discouraged staff from selling their fourth week of leave because rest and recreation were important to ensure good performance on the beat. While each application is considered on a case-by-case basis, no staff did so in 2015/16.
Customs (2 per cent), Corrections (1.3 per cent) and ACC (2.6 per cent) had very few staff taking up the option.
Almost 13 per cent of permanent staff at the Civil Aviation Authority (CAA) took the money - an average additional income of just over $2000.
Under employment law, requests to cash in up to a week of annual leave for cash can be made all at once, or multiple requests can be made until one week is cashed up. An employer can't pressure an employee into cashing up holidays.
The only other time people can get cash-for-leave is when they leave a job and have leave owing.
Those who cashed in leave in 2016/17
Customs - 2 per cent
Corrections - 1.3 per cent
ACC - 2.6 per cent
Ministry of Transport - 6 per cent
NZDF - 29 per cent
Police - 0 per cent
Treasury - 3.8 per cent
Department of the Prime Minister and Cabinet - 4.3 per cent
Ministry of Education - 8 per cent
Statistics - 4 per cent
Ministry of Justice - 6.6 per cent
Trade and Enterprise (NZTE) - 4.4 per cent
Inland Revenue - 4.2 per cent
Ministry of Business, Innovation and Employment - 4.5 per cent
Civil Aviation Authority - 12.5 per cent
Source: Reports to Parliament. Some numbers reported by agencies were for year to March 31, given deadline for submission.
Cashing up leave
• You can swap up to one week of your annual leave for cash each year - up to five days if you work a regular five-day week, or one quarter of your annual entitlement if you don't.
• Ask your employer for this in writing. You can ask to cash in leave multiple times a year, as long as the total you cash in isn't more than a quarter of your total leave allowance for the year.
Source: NZ Government
