Christmas baubles in sea foam: how to treat various NZ public holiday scenarios this festive season

Yes, another year is coming to close and you know what that means ... Christmas and New Year public holidays!

Fortunately there is no Mondayisation to contend with over the 2018/2019 festive season as the public holidays all fall on weekdays - good news for payroll managers!

2018/19 NZ Christmas and New Year public holiday dates

Whilst preparing your pay runs over the coming weeks you may have to deal with some of the following public holiday scenarios. Read on to learn how to treat these correctly in your payroll system:

Length of service

 Scenario: Jane starts her first day at a popular cafe during their busy season on Monday, 24 December. Is Jane entitled to Christmas Day and Boxing Day public holidays as paid leave on the 25th and 26th December?

Yes. Although Jane has only worked one day for the business she is entitled to any public holidays which fall after her start date.

There is no minimum length of service before an employee becomes entitled to public holiday benefits.

Type of employment agreement

 Scenario: Derek is a casual worker at a tourist hot-spot over the summer and has been asked to work for the two weeks over the Christmas/ New year period to cover a staff member on ACC. Will he be entitled to anything for the public holidays he works?

Yes, Derek would receive time-and-a-half for the hours he works on the four public holidays, although he would not receive four days in lieu (alternative holidays) because he would not normally have worked those days.

It doesn't matter what type of employment agreement a worker is under - full-time, part-time, fixed-term or casual - all employees are entitled to public holiday benefits.

Requirement to work on public holidays

 Scenario: Corinne works as a receptionist at a real estate firm on Tuesdays, Wednesdays and Thursdays. The business previously closed down for two weeks over the holiday break, but this year have decided to trial remaining open for business. The 2018/2019 public holidays would otherwise be working days for Corinne, however her employment agreement does not state she has to work public holidays. Is Corinne required to work on the Tuesdays and Wednesdays?

No, Corinne can refuse to work those days and be paid for the public holidays instead, as her contract does not stipulate she is required to work on statutory holidays.

An employee can only be made to work a public holiday if:

  • that day would be an "otherwise working day", and;
  • their employment agreement says they have to work on public holidays.
Annual close-downs

 Scenario: Michael started work mid-December at a law firm. The firm closes down over the holiday break for three weeks. Michael is employed full time, Monday to Friday. Will he receive any wages over the close-down period?

Yes, Michael would be entitled to be paid for the four public holidays, but as he started mid-December he will not have any annual leave owing.

If a public holiday falls during a company's close-down period, then all employees are entitled to a paid public holiday (if they would normally have worked that day had the close-down not been in effect).

Public holidays coinciding with other leave

 Scenario: Caleb works five days a week and has submitted a leave request for three weeks off, from 10 December to 28 December. His employer approved the request. How many days of annual leave should be paid to him over the three weeks?

When Caleb's pays are processed he should have a total of 13 days of annual leave paid out, along with two days of public holidays to cover Christmas and Boxing Day.

Public holidays take precedence over annual leave days when these fall on the same day.

Unable to work on a public holiday

 Scenario: Holly works full-time in retail. As the duty manager she is often required to work public holidays, however on the eve of Boxing Day she finds out her grandfather passed away. Holly takes Boxing Day and 27 December off due to the bereavement. How should these days be paid in her wages?

She will receive one paid public holiday and one day of paid bereavement leave, both at her relevant daily pay. Of the three days bereavement Holly would be entitled to, only one day is recorded as taken for her grandfather's passing.

In the event an employee had intentions of working a public holiday however due to sickness or bereavement was unable to, it is treated as a paid, unworked public holiday. The employee would therefore:

  • be paid their relevant or average daily pay, but would not be paid time and a half or receive an alternative holiday, and;
  • no sick or bereavement leave should be deducted.
Parental leave

 Scenario: Linda's baby is due on 20 December. She took maternity leave from her administration job a few weeks ahead of the due date on 3 December. Is Linda entitled to any payment from her employer for the public holidays?

No, Linda would not receive any public holiday pay from her employer.

For employees on parental leave when a public holiday falls, the employer does not have to pay the employee for the public holiday as the employee would not normally have worked that day.

If the employee is receiving a parental leave payment during such a time, the payment amount or the number of weeks they get a payment for is not affected by the public holiday.

There are a few key terms in the employment law realm which have scope to cause a great deal of confusion, such as "relevant daily pay", "average daily pay" and "otherwise working day". In cases where staff work regular set days and hours, or are on salary, these terms are usually clear-cut and easy to work out. However when employees work irregular hours and have changeable shifts, the lines can become blurred. For this reason the Ministry of Business, Innovation and Employment (MBIE) have developed a "Relevant and Average daily pay calculator" and an "Otherwise working day calculator" - click on the links to visit the MBIE website to use these handy tools.

And lastly, don't forget to keep accurate and comprehensive time, wage and leave records on all your employees. Being caught out not having complete employment records on file, either in electronic or hard-copy form, may result in hefty penalties which could dampen even the most jovial of holiday spirits!

Have we left any holiday season payroll conundrums off this list which have you scratching your head? Contact Vicki Cozens, our employment, payroll and HR specialist, for expert advice.