The October public holiday, often known as the Halloween bank holiday, falls on the last Monday in October.
In this blog, we have provided an easy go-to guide for employers to take the pain out of public holiday calculations.
Public Holiday Entitlements
As a general overview, the Organisation of Working Time Act 1997 requires employers to provide one of the following options in lieu of a public holiday:
- A paid day off within a month of the public holiday
- An additional day of annual leave
- An additional day's pay
- The nearest church holiday to the public holiday as a paid day off.
Most employers normally opt for either (3) or (4) above; an additional day’s pay if the employee works or a paid day off if they don’t work.
The most important consideration is whether or not the employee has worked, or normally works, on the day the public holiday falls. The below rules apply whether the employee is full-time, part-time or fixed-term.
What happens if the public holiday falls on a day that the employee works or is normally rostered to work?
If the public holiday falls on a day the employee works or is normally rostered to work then the employee is entitled to be paid the equivalent of the hours they worked on the last working day before the holiday.
If the employee falls into this category, the calculation is simple: what hours did they work on their last normal working day before the public holiday?
Let’s look at an example:
- The public holiday falls on Monday 27 October and this is a day the employee normally works.
- Their last working day before the public holiday was Friday on which they worked 7 hours.
- Thus, the employee’s public holiday entitlement is 7 hours pay.
This calculation is usually quite straightforward for full-time employees, as they would normally work the same hours every day. However, if the employee is part-time or on variable hours, the public holiday entitlement may vary from one public holiday to the next.
What happens if the public holiday falls on a day that the employee does not work and would not normally work?
If the employee doesn’t work on the public holiday itself and it is a day that they don’t normally work then they are entitled to be paid the equivalent of one-fifth of their last working week.
Let’s look at an example:
- The Public Holiday falls on Monday 27 October and the employee doesn’t work on the holiday and they don’t normally work Mondays.
- The employee worked 18 hours over the previous week, running from 20 October to 24 October 2014.
- Thus, the employee would be entitled to one-fifth of 18 hours for the public holiday.
- This equals (1/5 of 18 hours) = 3.6 hours. Similarly, if they worked for 40 hours over that week then it would be (1/5 of 40 hours) = 8 hours.
Again, this calculation is usually quite straightforward for full-time employees. If the employee is part-time or on variable hours, however, the public holiday entitlement will likely vary from one public holiday to the next.
The “Double-Time” Trap
One key issue that often arises is that employers tend to misinterpret “an additional day’s pay” as meaning “double-time”. Let’s look at an example:
- We will use the example of an employee who always works 8 hours a day, and always works Mondays. This employee is then asked to work for just 4 hours on the public holiday, as the employer is shutting the doors early.
- For this full-time employee, their entitlement for the public holiday would be “an additional day’s pay” of 8 hours. This 8 hours would be added to the 4 hours they actually worked on the holiday, meaning a total of 12 hours pay.
- If, however, the employer paid “double-time” (i.e. 4 hours x 2) then the employee would only have received 8 hours pay and would therefore have been short-changed. The basic rule is don’t use “double-time”; use the calculations provided in the above guidance.
Need help calculating public holiday pay?
For expert guidance on how to calculate public holiday pay this October, contact our advisors today on our dedicated 24/7 advice line.
If you are not a Peninsula client yet, call us on 1800 719 216 for a complimentary HR consultation.
