Know­ing your rights over hol­i­day pay

Kapi-Mana News - - WHAT’S ON - ALAN KNOWSLEY

On res­ig­na­tion, what do you need to know about hol­i­day pay, an­nual leave and pub­lic hol­i­days?

Some large gov­ern­ment de­part­ments have been in the news re­cently for get­ting their pay wrong.

Hol­i­day pay can be tricky. An of­ten for­got­ten re­quire­ment is to pay for pub­lic hol­i­days that fall within un­taken an­nual leave af­ter an em­ployee leaves em­ploy­ment.

On a pub­lic hol­i­day, em­ploy­ees for which the day would ‘‘oth­er­wise be a work­ing day’’ are en­ti­tled to be paid for their usual hours if they do not work. If an em­ployee works on the pub­lic hol­i­day they will re­ceive a day in lieu as well as be­ing paid their usual hourly rate plus half that amount again.

On an em­ployee’s res­ig­na­tion, their en­ti­tle­ment to pub­lic hol­i­days does not change. In re­gards to any days in lieu earned, the em­ployee will be paid the amount they would or­di­nar­ily earn on that day with their last pay, as well as any en­ti­tle­ment to hol­i­day pay.

If an em­ployee has out­stand­ing an­nual leave ow­ing af­ter their fi­nal day of em­ploy­ment, the an­nual leave tacks on to the last day of their em­ploy­ment.

If a pub­lic hol­i­day falls within the an­nual leave at the end of the em­ploy­ment and is ‘‘oth­er­wise a work­ing day’’ for the em­ployee, this must be treated as a pub­lic hol­i­day in ac­cor­dance with the Hol­i­days Act 2003.

For ex­am­ple, an em­ployee was leav­ing their em­ploy­ment af­ter one year and had taken only one week of their an­nual leave en­ti­tle­ment of four weeks.

They would be en­ti­tled to three weeks’ an­nual leave, any days in lieu they had ow­ing, as well as hol­i­day pay, which is cal­cu­lated as 8 per cent of their earn­ings since the date they be­came el­i­gi­ble for an­nual leave – in­clud­ing the value of the owed an­nual leave and the days in lieu.

The an­nual leave tacks on to the fi­nal day of em­ploy­ment, so if a pub­lic hol­i­day fell within this pe­riod (which would have been a day they would nor­mally work), then this must be treated as a pub­lic hol­i­day and paid ac­cord­ingly on top of their an­nual leave.

Cal­cu­lat­ing whether a day would ‘‘oth­er­wise be a work­ing day’’ can be dif­fi­cult if the em­ployee has a dif­fer­ent work­ing sched­ule each week.

The fol­low­ing is­sues should be con­sid­ered:

What is in the em­ploy­ment agree­ment.

The em­ployee’s usual work pat­terns.

The em­ployer’s ros­ters or other sys­tems or records.

Le­gal mat­ters

The rea­son­able ex­pec­ta­tions of the em­ployer and em­ployee as to whether the em­ployee would work on the day con­cerned.

Whether the em­ployee works for the em­ployer only when work is avail­able.

Whether, but for the day be­ing a pub­lic hol­i­day, an al­ter­na­tive hol­i­day, or a day on which the em­ployee was on sick leave or be­reave­ment leave, the em­ployee would have worked on the day con­cerned.

Whether it is dur­ing a cus­tom­ary close­down pe­riod.

Em­ploy­ers need to be care­ful they get all of their pay cal­cu­la­tions right or they could find them­selves fac­ing big back pay bills just like some gov­ern­ment de­part­ments re­cently. CON­TACT DE­TAILS Col­umn cour­tesy of Rainey Collins Lawyers, phone 0800 733 484 or rain­ey­collins.co.nz. If you have a le­gal in­quiry, you would like dis­cussed email aknowsley@rain­ey­collins.co.nz. Our free pub­lic sem­i­nar on deal­ing with re­la­tion­ship prop­erty is­sues will be on April 27, 12.15pm till 1.15pm. See our web­site.

It is im­por­tant for em­ploy­ees to know where they stand on hol­i­day pay.

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