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Getting holiday pay right

Do you have staff taking leave over Christmas? Are systems in place to make sure everyone gets what they’re entitled to? Even if someone else handles your payroll, you are responsible for making sure holiday pay and leave payments are handled correctly.


  • Whether your staff work full-time, part-time, casual, on-call, or shift work, they’re entitled to any benefits that come from working on public holidays.
  • If your employee agrees to work on a public holiday that falls on a day they would normally work, they will need to be paid time and a half PLUS receive another paid day off later, otherwise known as a day in lieu. If an employee works on a public holiday, and it is not a day they would usually work, the employee is only entitled to the time and a half. The entitlement to time and a half has to be included in employment agreements.
  • Consider shifts that cross days at midnight.  Once employees are working in the public holiday, their hours must be recorded and paid correctly with the correct entitlements.
  • Employees can choose to take their day in lieu:

○   on a mutually agreeable date that is not a public holiday

○   on another day on which they would normally be working

○   for a whole working day, regardless of how much of the public holiday they actually worked.

  • If your business is having a closedown period, employees are entitled to a paid public holiday if they would ordinarily work on the day of the public holiday.
  • Make sure your payroll system:

○   is flexible enough to handle different working arrangements (eg, changing employee work schedules)

○   records all relevant time worked and payments made

○   has accurate and up-to-date information.        

  • If you realise an employee hasn’t been paid the right amount, be up front and correct the mistake immediately.

As always, if you want to check anything you’re doing, be sure to contact Natalie, our Payroll Administrator, [email protected]

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