Payment for public holidays during Christmas-New Year

Some businesses close during the Christmas-New Year holiday period. Usually, employees will be paid annual leave during this time as part of an annual close down, but how should the employees on unpaid leave be paid for the public holidays that occur during this period?

What are the public holidays during Christmas-New Year 2021-2022?

^{#This is a substitute day, not additional day.}

How do employees usually get paid for public holidays?

Under the Fair Work Act, an employee (other than a casual employee) is entitled to be absent from work on a day that is a public holiday and to be paid their base rate of pay for the ordinary hours they would have worked if they had not been away.

Usually, an employee will not be paid for a public holiday if they don’t normally work on the day that the public holiday falls.

For example, a part-time employee who does not normally work on Mondays will not be paid for the Christmas Day or New Year’s Day public holidays this year as they both fall on a Monday.

There are some awards that provide an additional entitlement for full-time employees to be paid either an extra day’s pay, or be provided with an alternative day off, or receive an additional day’s annual leave, if a public holiday falls on a day that they do not usually work (except weekends).

Public holidays during leave

If a public holiday occurs while an employee is on leave, their entitlement to be paid for the day depends on whether they are taking paid leave or unpaid leave.

Paid leave and public holidays

If a public holiday falls during a period of paid leave (such as annual leave), the employee must be paid for the public holiday if they would ordinarily have worked on that day. This includes any hours that fall on a part-day public holiday, which occurs in some states/territories.

The public holiday will not be counted as annual leave. This means that the public holiday hours will not be deducted from the employee’s amount of accrued leave.

Example: Public holidays during a period of annual leave

Zoe is a full-time employee who usually works Monday to Friday. She has applied to take annual leave from Monday 20 December 2021 until Friday 31 December 2021. She will come back to work on Tuesday 4 January 2022.

This year, Christmas Day, Boxing Day and New Year’s Day fall on the following dates:

• Saturday 25 December 2021 - Christmas Day
• Sunday 26 December 2021 - Boxing Day
• Saturday 1 January 2022 - New Year’s Day

As the public holidays fall on the weekend, some states provide for an additional or substitute public holiday on the following weekday.

In Victoria, for example, additional public holidays will be observed on:

• Monday 27 December 2021 – Christmas Day
• Tuesday 28 December 2021 – Boxing Day
• Monday 3 January 2022 – New Year’s Day

Zoe will be paid for these additional public holidays as she would normally be required to work on these days. The public holidays will not be deducted from her annual leave amount. This means only 8 days are deducted from Zoe’s annual leave balance.

Unpaid leave and public holidays

If an employee is on unpaid leave on the day before and the day after a public holiday, they will not be entitled to payment for such public holiday.

This is because when an employee is on unpaid leave, they are considered to have no ordinary hours in that period.