The Government has announced that on Monday 26 September 2022, New Zealand will observe a one-off public holiday to mark the recent passing of the Queen. Legislation will be enacted next week to bring the public holiday into force – officially named Queen Elizabeth II Memorial Day (QEII Memorial Day).
The Government has confirmed that normal laws relating to public holidays will apply on QEII Memorial Day and that no shop trading restrictions will be in place. In light of this new one-off public holiday, it is worth recapping the current law concerning public holidays.
Otherwise working day
When determining how to pay employees for public holidays, the first thing to determine for each employee is whether a public holiday falls on an ‘otherwise working day’ for that employee. An ‘otherwise working day’ is a day that the employee would have worked had the day not been a public holiday. To determine whether a day is an ‘otherwise working day’, the Holidays Act 2003 (Holidays Act) states that the following factors must be considered:
- The employee’s employment agreement;
- The employee’s work patterns;
- Whether the employee works for the employer only when work is available;
- The employer’s rosters or other similar systems;
- The reasonable expectations of the employer and the employee that the employee would work on the day concerned; and
- Whether, but for the day being a public holiday, the employee would have worked on the day concerned.
Payment when public holiday not worked
If an employee does not work on a public holiday that was an ‘otherwise working day’ for that employee, they are entitled to payment at not less than their relevant daily pay or average daily pay for that day.
If an employee does not work on a public holiday that was not an ‘otherwise working day’ for that employee, they are not entitled to any payment under the Holidays Act.
Payment when public holiday worked
If an employee does work on any part of a public holiday, they are entitled to the greater of their relevant daily pay or average daily pay for the time worked on the public holiday, plus half that amount again.
If an employee works on any part of a public holiday that is an ‘otherwise working day’ for that employee, they are also entitled to an alternative holiday, also known as a ‘day in lieu’. This alternative holiday is in addition to payment for working on the public holiday.
Can I require an employee to work on a public holiday?
An employee can only be required to work on a public holiday if:
- The day falls on an ‘otherwise working day’; and
- The employee’s employment agreement requires them to work on the public holiday.
For obvious reasons, existing employment agreements will not explicitly refer to QEII Memorial Day. However, employment agreements may contain a catch-all clause, whereby the employee has agreed that they may be required to work on a public holiday and will do so if asked. An employee whose employment agreement contains this catch-all clause may be required to work on QEII Memorial Day.
In the absence of any such clause, or if the public holiday is not an ‘otherwise working day’, an employer cannot require an employee to work a public holiday. An employee could still choose to agree with their employer that they will work on a public holiday.
What if an employee already has annual leave booked on a public holiday?
If an employee has annual holidays (leave) booked on a public holiday, they should still be paid in accordance with the above. This means that the employee should not lose a day of their annual holiday entitlement for public holidays that fall during leave.
What happens if I get it wrong?
If an employee (or ex-employee) is incorrectly paid for a public holiday, their employer can be held liable to backpay the employee the amount owed, plus interest. The employer could also be liable to pay penalties.
What if I didn’t mean to get it wrong?
The Employment Relations Authority has established that ignorance of the Holidays Act is not a sufficient defence and that employers have to be deemed to know the law (Cross v D Bell Distributors Ltd [2017] NZERA 295 at [46].).
Assistance
We regularly advise businesses and individuals on their obligations under the Holidays Act and would be happy to do the same for you. Please contact a member of the Lane Neave Workplace Employment Law team for assistance.
