Santa's Always Watching
Paying Employees correctly this holiday season is one of many ways to stay off Santa’s naughty list and ensure smooth sailing into the new year. We understand that the Holidays Act 2003 can be tricky to navigate particularly around Christmas time as most businesses usually have more staff working to cover the increase in demand over the silly season. We are here to prepare your payroll, so you aren’t caught out this holiday season.
The Holidays Act recognises Christmas Day, Boxing Day, New Year’s Day and 2 January as public holidays. Fortunately, this year all these public holidays fall on either a Tuesday or Wednesday during the week and therefore Employer’s do not have to worry about the Mondayisation of public holidays.
As majority of business will be precluded from opening on Christmas Day under the Shop Trading Hours Act 1990, what obligations do you have as an Employer in terms of paying your Employees? As Christmas falls on a Tuesday this year, if Tuesday would be considered a normal working day for your Employee you will be required to pay them for the hours they would have worked, had your business been open. However, you will not be required to pay Employees time and a half, nor will they be entitled to an alternative day.
Some Employers may have an automatic exemption under the Shop Trading Hours Act, or by a local Council Bylaw, which allows them to be open on Christmas Day such as Petrol Stations and Convenience Stores. If you fit into this category and you have staff working on Christmas Day, as Christmas is considered a public holiday, staff will be entitled to receive their ordinary rate of pay, plus half that amount again, for each hour worked (time and a half). Additionally, if Tuesday is an ordinary working day for them, they will be entitled to an alternative day.
All businesses can open on Boxing Day, New Year’s Day and 2 January and are not prevented from doing so under the Shop Trading Hours Act. As these dates are recognised public holidays under the Holidays Act, if your Employee works on any of these public holidays, they will be entitled to receive time and a half for each hour worked. Additionally, if these public holidays fall on a date which would be considered an ordinary working day for an Employee, they will be entitled to an alternative day.
Calculating pay for public holidays can become a lot trickier where an Employee is completing a shift that starts on a public holiday and finishes on the following day (which is not a public holiday) or vice versa. For example, you may have an Employee starting work at 10:00pm on Boxing Day, with them finishing work the following day at 6:00am. For the first two (2) hours of their shift, they would be entitled to receive time and a half for each hour worked, plus and alternate day if this was considered their normal working day. The remaining six (6) hours of the shift would be remunerated at the Employees ordinary rate of pay.
Where Employees works a shift, which fall part on one (1) day, part on the next, under the Holidays Act the parties can agree to transfer part of the public holiday in exchange for treating a 24-hour period as a public holiday, provided the period ends on the actual public holiday. Parties can also agree to transfer whole of the public holiday to an alternative date, meaning that the alternative date would be recognised as the public holiday for that Employee. These arrangements to transfer whole, or part, of a public holiday should always be recorded in writing and signed by both the Employer and Employee.
If you need assistance this holiday season with your payroll contact one of our team before we get to the silly season to ensure that your payroll team is prepared.