How to calculate and pay employees for public holidays
Correctly calculating and paying employees for public holidays is a legal requirement under the Fair Work Act 2009 and is an essential part of leave management and payroll.
- When holidays fall on a weekend.
- Working out public holiday entitlements.
- What to casual staff.
- FAQs.
When holidays fall on a weekend
In some state or territory, when a public holiday falls on a weekend, an additional public holiday may be moved to the following weekday (Monday generally).
But only some employee benefit from that "moved" holiday, depending on their regular work schedule.
For example, If an employee normally works on the weekend, they get the public holiday on the actual calendar date.
If they do not normally work weekends, they get the substitute day (e.g. Monday) as their public holiday.
Working out public holiday entitlements
Employees on fixed work schedules
If the public holiday falls on a day your full-time or part-time employee usually works, they are entitled to the day off at their ordinary pay. If they are working the public holiday they will generally be paid a public holiday penalty rate or other entitlements depending on what industrial instrument (like a modern award) governs their employment or what is set in their employment contract.
Employees on variable schedules
Employees who work variable schedules can present challenges, but most businesses still operate a roster system and you can rely on this to determine who gets a public holiday.
Where the rostered days naturally rotate to fall on the public holiday, it is a day the employee would normally work, so they get the public holiday entitlement. Where the roster naturally rotates so the public holiday is a rostered day off, the public holiday is not a day they would normally work.
You must also look at the employee’s award, enterprise agreement, and/or employment contract to ensure you are meeting any entitlements specified there.
You cannot adjust the roster or take an employee off the roster so that they miss out on public holiday entitlements.
If you are in doubt about normal working days because of the employee’s work pattern, review their average pattern over the previous 4 weeks.
What to pay casual staff
Casual employees are entitled to take the day off on public holidays, but do not receive payment for it, as their employment is on an as-needed basis.
If they work on a public holiday, they are entitled to be paid their base rate of pay plus any applicable public holiday loadings.
FAQs
Can employees work on a public holiday?
Yes but only if the request is reasonable (consider the employee’s personal situation for one) and the employee is given the option to refuse.
What if an employee is on leave during a public holiday?
The public holiday is not deducted from the employees leave balance if the leave falls on the relevant date.
What do I do if an employee is working out of state the day of a public holiday?
Public holidays entitlements are based on the employees usual work location, not where they’re located for a short period of time.So, if, for example, a Canberra-based employee is in NSW on Canberra Day, they are still entitled to take that day as a public holiday.
What if someone covers a shift that isn't their normal shift?
If someone covering a shift for someone else on a public holiday, if it is not that person’s usual working day, they get paid generally a higher rate or loading according to their award, agreement or employment contract, and the person whose shift it normally is gets paid their base rate for the public holiday.
Can I agree on substituting public holidays for an employee?
Public holidays can be substituted for another day by agreement between the employer and employee. The ability to do this for award-covered employees will depend on the award. For award-free employees, public holidays can be substituted if both parties agree.
This can cause confusion whenever a public holiday falls on a Tuesday, Wednesday, or Thursday. For example, if ANZAC Day falls on a Tuesday, you could by agreement with employees move the public holiday to Monday, granting a long weekend. Employees would receive payment for Monday off work as the transferred public holiday and Tuesday is now a normal working day; they attend work and get paid normal time, with no alternative holiday.
This must be in writing and must be agreed. If your workplace cannot accommodate this transfer, you do not have to agree to an employee transfer request. Equally, you cannot force a transfer if the purpose of the transfer is to reduce entitlements.
Do new employees have a or qualifying period?
We sometimes get asked if there is a qualifying period before an employee receives a public holiday entitlement and the answer is no, there is no qualifying period.
Under the NES, employees are entitled to public holidays from their first day of work.
How can I determine if restricted trading days affect my business?
In all states, apart from the Australian Capital Territory and Northern Territory, there are some public holidays that are specified as restricted trading days, e.g. in NSW, Good Friday, Easter Sunday, Anzac Day (before 1pm), Christmas Day, and Boxing Day (outside the Sydney Trading Precinct) are restricted trading days.
On these days, almost all shops are required to be closed, except for those with exemptions due to the nature of their trade, e.g. petrol stations, chemists, hotels, bars, and certain small shops, or those that have applied for and been granted an exemption.
Check with your state or territory government on what public holidays are restricted trading days and whether you can trade.
As always, if you are confused or have a very specific and/or unusual public holiday scenario, then consult an expert. The team at MyHR is available to help you get this right.