Understanding your holiday obligations and payments

The lead up to Christmas can be a stressfull time for businesses and employees as work loads and other commitments are juggled and finances come under strain. It's a good time to remind ourselves of our legal responsibilities regarding holiday pay over the coming months.

In New Zealand all employees are entitled to a minimum of four weeks annual leave after twelve months continuous employment. It's good for everyone in the business to have time off work for rest and recreation. In addition to the four weeks, we have 11 public holidays (or 'stats') each year. Four of these stats fall in the Chirstmas/New Year period: Christmas Day (Monday 25 December), Boxing Day (Tuesday 26 December), New Years (Monday 1 January) and the day after New Years Day (Tuesday 2 January).

When a public holiday falls on a day your employee would normally work then they're entitled to a paid day off, regardless of how long they have worked for you. An employee can only be required to work on a public holiday if:

  • they've agreed to this, and
  • it's written into a signed employment agreement.

If they work on the public holiday you have to:

  • pay them time and hald for that work, and
  • give them a full day off in lieu for doing so, even if they didn't work a full day on the public holiday.

If you normally closedown over Christmas, you can require your employees to use their annual leave during this time. They'll be paid for the stats if they would normally work those days, and if they don't have enough leave to cover the other days of the closedown, you can either agree to allow them to take annual leave in advance, or they can take leave without pay.

Your employees are entitled to receive their pay for accrued annual holidays before the holidays starts.

Good communication is the key to ensure everybody knows their entitlement. Get your employees to submit leave forms for approval well before the Christmas period, and make sure you hav e communicated their acceptance (or have negotiated with your employee) so that everyone is clear about their obligations and can have a happy holiday period.

To find out more about how to get holiday pay right read https://copelandashcroft.co.nz/news/holiday-pay-%E280%93-how-get-it-right

Still unsure about your specific business situation and want to avoid getting it wrong?... give us a call and our experienced HR Consultants will be happy to assist with all your enquiries.