The passing of the Holidays (Full Recognition of Waitangi Day and ANZAC Day) Amendment Act 2013 (which "mondayises" Waitangi Day and ANZAC Day should they fall on a weekend) and ANZAC Day on 25 April, is a timely opportunity to remind employers of their obligations around public holidays.
The Holidays Act 2003 sets out the public holidays obligations. The Act sets the minimum standards to be followed, but an employer is not prevented from providing additional entitlements. However, an employment agreement cannot provide inferior conditions to what's set out in the Act, even if the employee agrees.
There are considerable consequences for failing to recognise employees' minimum entitlements. An employee, union, representative or Labour Inspector can take an action to recover minimum entitlements. Furthermore, failure to recognise and pay for public holidays may expose employers to a penalty of up to $20,000.
Recognised public holidays
The Act recognises 11 days each year as public holidays, which are Christmas Day, Boxing Day, New Year's Day, 2 January, Waitangi Day, Good Friday, Easter Monday, ANZAC Day, Queen's Birthday, Labour Day and Anniversary days. Employers must generally observe public holidays on the date they fall, unless an exception applies.
The Act allows for an employer and employee to transfer the whole or part of a public holiday to be observed on a different date. For a transfer to occur, there must be a written agreement between the employer and employee. The agreement must identify the public holiday concerned and the date to which the public holiday is being transferred. In addition, the day on which the public holiday falls must be a normal working day for the employee. The new transfer date must also be a normal working day for the employee and must not be another public holiday.
To take this year's ANZAC Day as an example, an employer and employee can agree to observe ANZAC Day on the following Monday if the employee normally works on Thursday (ANZAC Day) and Monday (transferred day).
Where a public holiday is transferred, the transferred date is to be treated as the employee's public holiday. It is important to note that an agreement to transfer the whole or part of an employee's public holiday must not reduce the total number of public holidays that the employee is entitled to get each year.
In the end, if transferring public holidays is going to be a hassle or unworkable for a particular business, the Act allows employers to adopt a policy prohibiting such transfers.
Who is entitled to public holidays
For the avoidance of doubt, any employee is entitled to public holidays. The Act does not specify different entitlements to public holidays based on the type of employment. Therefore, an employer must recognise an employee's entitlement to public holidays whether that employee is a casual, temporary, full-time, fixed-term or permanent employee.
Payments for public holidays
If a public holiday falls on a day that would normally be a working day for an employee, the employee is entitled to not work on that day and be paid at his/her normal rate.
If the employee is required to work on a public holiday, and that day would not normally be a working day, he/she is entitled to be paid at least time and a half for the hours worked.
If a public holiday does fall on a normal working day, the employee is entitled to an alternative holiday (a day in lieu) in addition to being paid at least time and a half for the hours worked.
In the situation mentioned above where a public holiday has been transferred by agreement to another day, the employee is entitled to be paid at least time and a half, and be given a day in lieu if the employee is required to work on the agreed transfer date.
Working out "what would otherwise be a working day"
Working out "what would otherwise be a working day" is less difficult if an employee works regular 9 to 5 hours, 5 days a week. However, things can be trickier for seasonal, casual or temporary workers.
The Employment Court has held that the question of what would otherwise be a working day is a question of fact. However, the Act does provide some guidelines as to how this question can be worked out. Relevant factors to consider include:
the employment agreement;
the employee's work patterns;
whether the employee works only when work is available;
rosters or other similar systems;
the reasonable expectations of the employer and 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.
If, after considering the above factors, the employer and employee still cannot agree on whether a day would otherwise be a working day for the employee, a Labour Inspector can be called in to resolve the question. In making the determination, the Labour Inspector must discuss the matter with both parties, and give them both the opportunity to comment.
Certain public holidays are already "mondayised" under the Act. If Christmas Day, Boxing Day, New Year's Day or 2 January fall on either a Saturday or Sunday (and that day would not otherwise be a working day), then those public holidays are to be treated as falling on the following Monday or Tuesday. Similarly under the new "mondayising" Act, if Waitangi Day or ANZAC day falls on Saturday or Sunday (and that day would not otherwise be a working day), then those public holidays should be treated as falling on the following Monday.