At this time of year it is usual to have public holidays falling within a leave period. So how do you treat the statutory holidays during annual leave, sick, bereavement or family violence leave, or a business close-down period? Get ready. We have prepared a reference list to zoom through if something like that occurs in your business this summer. Below that, for those who like the details, we have expanded on the summary. (You’re welcome!)
If a public holiday falls during a period of leave, the following rules apply:
- If a business has a close-down period that includes public holidays, the employee is entitled to a paid public holiday if they would have normally worked on that day if the closedown was not in effect. (You can read more about closedowns in our earlier blog).
- If an employee is on annual leave when there’s a public holiday, they get a paid public holiday if they would have normally worked on that day, and do not lose an annual leave day.
- If an employee is on parental leave and a public holiday falls within that leave, the employer doesn’t have to pay for the public holiday because the employee would not have normally worked on that day. If the employee is getting a parental leave payment over a week when there is a public holiday, the payment amount and number of weeks they get a payment for is not affected by the public holiday.
- When an employee would have worked on a public holiday but does not due to being sick, affected by family violence (if entitled to family violence leave), or suffering a bereavement, the day is treated as a paid unworked public holiday. In determining whether the day would have been an otherwise working day for the employee, the employer must have regard to the factors set in the Holidays Act 2003.
- If a public holiday falls during a period when an employee is taking a planned time off without pay from work, they would not normally receive any payment for the public holiday. This is because it would not be an otherwise working day.
- An employer is required to pay an employee for an unworked public holiday when it falls on an ‘otherwise working day’. An employer generally won’t have to pay an employee for a public holiday when they are on ACC because these days are not ‘otherwise working days’ for the employee. This is because while an employee is injured, there is usually no reasonable expectation that they will be at work. There may be some exceptions to this, so it is important to make decisions about whether a day is an ‘otherwise working day’ on a case-by-case basis.
Contact FixHR if you have questions about holidays and tricky annual leave considerations. If you would like a better handle on this topic, the following should be helpful.
Business close-down period
If a business has a close-down period that includes public holidays, for example, over the Christmas and New Year period, then the employee is entitled to a paid public holiday if they would have normally worked on that day if the closedown was not in effect.
Annual leave
If an employee is on annual leave when there’s a public holiday, they get a paid public holiday if they would have normally worked on that day, and do not lose an annual leave day.
Parental leave
If an employee is on parental leave and a public holiday falls within that leave, the employer doesn’t have to pay for the public holiday because the employee would not have normally worked on that day. If the employee is getting a parental leave payment over a week when there is a public holiday, the payment amount and number of weeks they get a payment for is not affected by the public holiday.
Sickness, injury, bereavement or family violence leave
When an employee would have worked on a public holiday but does not due to being sick, affected by family violence (if entitled to family violence leave), or suffering a bereavement, the day is treated as a paid unworked public holiday.
In determining whether the day would have been an otherwise working day for the employee, the employer must have regard to the factors set out in the Holidays Act 2003. (Yes, we are still referring to that old piece of law at this stage. Next Christmas we anticipate applying a newer piece of legislation which is hopefully more fit for purpose.)
Otherwise working day
If the day would have been an otherwise working day:
- the employee would be paid their relevant daily pay or average daily pay, but would not be entitled to time and a half or an alternative holiday
- no sick or family violence leave is deducted from the employee’s entitlement balances
- the public holiday does not count as one of the days the employee is entitled to take after suffering a bereavement.
Unpaid leave
If a public holiday falls during a period when an employee is taking a planned time off without pay from work, they would not normally receive any payment for the public holiday. This is because it would not be an otherwise working day.
Public holiday entitlements while receiving ACC weekly compensation
An employer is required to pay an employee for an unworked public holiday when it falls on an ‘otherwise working day’. An employer generally won’t have to pay an employee for a public holiday when they are on ACC because these days are not ‘otherwise working days’ for the employee; while an employee is injured, there is usually no reasonable expectation that they will be at work.
There may be some exceptions to this, so it is important to make decisions about whether a day is an ‘otherwise working day’ on a case-by-case basis. This involves considering the otherwise working day test, along with checking any obligations in the employment agreement and workplace policies.
An example
When an employee gets injured, it is likely that any public holidays falling within the following week that would have been otherwise working days will continue to be considered otherwise working days, meaning that the employee will be entitled to payment from their employer for those public holidays. If this is the case and an employee is using leave entitlements (such as sick leave) to cover the first week after a non-work-related injury, their leave balances should not be deducted for the public holiday, and the employee should be paid for the public holiday instead.
First week of injury
If an employer is paying first-week compensation to an employee and the employee is entitled to a paid public holiday during that week, the employee should be paid their full relevant daily pay (or average daily pay, where applicable) for the public holiday, not 80 percent of that amount.
Interaction with ACC payments
ACC weekly compensation payments are calculated on a weekly basis and cover time away from work due to an injury. If an employee is paid for any public holidays while receiving ACC weekly compensation, their payment for that week may be affected. Employees need to let ACC know if any income, including for a public holiday, is paid during a period of weekly compensation in case it affects how much compensation ACC can pay them. You can find our more from ACC here.
Employers who are paying weekly compensation to an employee on behalf of ACC (through an Employment Reimbursement Agreement) should contact ACC to advise of any additional income paid to the employee, as this may affect the calculation of the employee’s weekly compensation.
Contact FixHR if you have questions about holidays and tricky annual leave considerations. We are here to help
