With Easter upon us, it is a good idea to review the rules around public holidays in the Holidays Act and Easter trading rules.
There are three and a half days a year when almost all shops must be closed under the Shop Trading Hours act 1990. One of these days is Easter Sunday. However in 1990 local councils were granted permission to pass a bylaw to permit Easter trading within its region Auckland Council has not amended the Easter Trading Rules and therefore, only certain shops can open with conditions on Easter Sunday in Auckland. Other regions such as Gisborne and Queenstown have passed bylaws to allow Easter Trading. If you want to know whether you are permitted to trade on Easter Sunday, click here.
Employees are not obligated to work on Easter Sunday. If a shop keeper plans to open on Easter Sunday, they will need to provide staff written notice of the employee's right to refuse to work. Unfortunately, the timeframe for providing this notice ended on 11 March 2018 and therefore, it will be a decision that will need to be negotiated by the parties. Staff can refuse to work on Easter Sunday without providing a reason.
If you’re an employee and you end up working on an Easter Sunday, you should be aware that Easter Sunday is not a public holiday and therefore, you will be paid your normal rate and will not be entitled to an extra paid day off unless this is specifically agreed and arranged with your employer.
Payment for public holidays
Employees are entitled to be paid for a public holiday if it is considered an ordinary working day for the employee. This is usually straightforward for permanent or permanent part time employees however, it may be less clear if the employee is a casual worker. If you're an employer with casual employees, you will need to analyse staff rosters and establish whether the casual worker would have otherwise worked on the public holiday.
To determine how much an employee should be paid on a public holiday, the Holidays Act provides for two mechanisms of payment - relevant daily pay or average daily pay.
- Relevant daily pay means paying the employee what they would have earned on the day. Often, employers will use relevant daily pay for employees that have clear defined hours of work and this will usually be permanent and salaried employees. Relevant daily pay includes allowances, commissions, overtime, lodgings and bonuses that the employee would have received on the relevant day.
- Average daily pay is used when it is not possible to work out relevant daily pay and takes the daily average of the employee's gross earnings over the past 52 weeks.
Employers should use relevant daily pay in the first instance to determine the amount an employee should receive for a public holiday especially when the employee's pay is regular and predictable. However, if this is difficult, it is permissible for an employer to use average daily pay when it is not possible or practical to determine the appropriate relevant daily pay. We suggest you seek legal advice if you are unsure whether to use relevant daily pay or average daily pay.
Working on Public Holidays
It is important to remember that both Easter Friday and Easter Monday are public holidays. In New Zealand, employers can only require an employee to work a public holiday if it's provided for in the employment agreement.
If you’re an employee and you work on a public holiday, you're entitled to time and a half for the hours worked and an additional paid day off which is recognised as a day in lieu. In some circumstances, there may be exemptions to an employer providing a day in lieu to an employee including:
- An employee wouldn’t usually have worked on the day;
- The employee only works on public holidays;
- The employee was on call during the public holiday and they were able to do what they wanted on the day.
We suggest that if you are unsure whether an employee is entitled to a day in lieu, you seek legal advice.
Transferring public holidays
Employers should also be aware that employees can transfer their public holidays to another day if there is agreement from both parties in writing. The employer is allowed to decline the application for transfer.
For a transfer to occur, the parties must identify a calendar day or 24 hour period day which would otherwise be another working day for the employee and the day cannot be public holiday. The employer can't transfer the holiday to avoid paying an employee for a public holiday or to prevent payment of an alternative holiday.
On the transferred public holiday day, the employee is entitled to day off. However, if they work on the transferred public holiday day, the employee is entitled to time and half plus a day in lieu (an alternative holiday). Again, payment will be based on the employee's relevant daily pay or average daily pay.