Public holidays & payroll

Public holidays & payroll

Christmas holidays and payroll

The trees are up, the presents are wrapped, the food prep is underway, and many of us are in a downward roll towards the holidays. With a number of public holidays coming up, it’s important to be across the rules around public holidays and payroll. Here’s what you need to know.

Public holidays

When public holidays fall during a team member’s leave, these are to be treated as public holidays and not as annual leave – it is treated as though they would have worked that day should they not have been on leave. The public holiday pay should not affect their leave accrual and be paid as another working day. The employee will be paid for any public holidays during the shutdown period that fall on days they would normally work.

An example of what can occur: Mary is a full-time employee who has requested leave for the duration of 5 days. This includes New Years Day, a public holiday that falls on a Monday. Because Mary is a full-time employee, she would need to be paid for New Years Day. This means that Mary is only taking 4 days of annual leave, not 5.

When team members take sick leave on either side of a public holiday, they are still entitled to be paid for the public holiday as though they would have been at work that day. The usual sick leave process applies unless there is any evidence that demonstrates otherwise.

An exception would be when the employee has been rostered to work on a public holiday, which is not a day they would usually work. If they were to call in sick, the employee would not be paid for that day. Additionally, no payment will be made for the public holiday if the employee is on unpaid leave.

Working on public holidays

All team members receive their base pay for hours worked on a public holiday. The varying entitlements are included in the Awards or Agreements for every person, including how public holidays will impact their pay.

Some of the entitlements that need to be considered:

  • Additional pay, i.e. public holiday penalty rates.

  • Extra day off or annual leave.

  • Minimum shift lengths on public holidays (e.g. 4 hours).

  • Any agreements made to substitute another day for the public holiday.

Your team cannot be forced to work on a public holiday. However, an employer can make this request if it is reasonable to the type of employment. Equally, the employee may refuse to do so when the refusal is based on reasonable grounds.

To understand what is deemed ‘reasonable’:

  • Circumstances for the team member which are personal, e.g. family responsibilities.

  • The amount of pay and whether there is any increase, e.g. penalty rates.

  • The type of work undertaken as well as the needs of the business.

  • Whether the team member’s agreement entails working on public holidays.

  • The employment status of the employee – full-time, part-time, casual or shift worker.

  • The amount of notice provided to either party.

The collective circumstances of the team member need to be considered prior to requesting they work on a public holiday.

Not working on public holidays

With the exception of casual employees, team members who would normally work on the specific day that the public holiday has occurred are to be paid their usual base rate in conjunction with their ordinary hours that they would have worked.

The base rate does not include:

  • Penalty rates.

  • Loadings.

  • Overtime.

  • Monetary allowances.

  • Bonuses or any incentive-based payments.

Please note that it is unacceptable to change an employee’s day of work to avoid making this payment.

An example of this would be: Steven is a part-time employee who works from Tuesdays to Thursdays. This year New Years Day falls on a Monday. Because Steven does not typically work on Mondays, he will not be paid for this holiday.

Unpaid leave and public holidays

If you have a team member of unpaid leave, they will not be paid for public holidays during the period of unpaid leave.

You can check out these resources and more on the Fair Work website.


PS. Whenever you’re ready, here are 3 ways we can help you eradicate financial stress in your accounting firm or professional services business – faster …

  1. Sign up to our LinkedIn newsletter, published weekly. You can sign up here: Eradicating Financial Stress

  2. Get our book “Wow – I’m in Business! Your journey from overwhelmed to organised.” It’s full of insights, solutions and downloadable resources you can implement into your business immediately. Click here for your copy: Wow … I’m in Business! – Miss Efficiency

  3. Book a time with me privately and we’ll do a deep dive into your Xero file to help you optimise for cash flow, efficiency and growth. Click here to book: Book a time with Sarah

Related Posts

member-img

Single Touch Payroll – Are you ready?

We're been hearing about Single Touch Payroll for a few years. It's now hear; some employers are in

Read More
member-img

Outsourcing payroll – 5 ways it can help you

When you start a business, you’re typically your only employee and payroll is about as simple as i

Read More
member-img

Merry JobKeeper!

Some of you may have noticed that Santa has been – in the form of the ATO and JobKeeper reimbursem

Read More