Resigning from your job: Outstanding holiday pay

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#529485 5-Oct-2011 11:39

It's very clear now, when I re-read your original comment it makes perfect sense, I was just reading it wrong (I must have skimmed over the gross earnings part without thinking about it).

heavenlywild

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#529494 5-Oct-2011 11:43

Neets, really good information, thanks. I wonder how many people have not been paid their public holidays should their entitled leave go over those days.

Hmmm, then again I am sure payroll understands this:)

cisconz

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#529514 5-Oct-2011 12:16

heavenlywild: Neets, really good information, thanks. I wonder how many people have not been paid their public holidays should their entitled leave go over those days.

Hmmm, then again I am sure payroll understands this:)

Depends on the Payroll system.
Most big companies I have been involved with don't pay it unless the employee realises.

Hmmmm

BlinkyBill

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#529539 5-Oct-2011 12:54

Most big companies I have been involved with don't pay it unless the employee realises

CISCONZ - This is not correct at all; companies would be breaking the law if they didn't make the payments as required and payroll systems are designed and implemented to uphold legal requirements.

The key thing on resignation is the resignation date. Once your resignation date is passed, you are no longer employed by the company, and the company isn't required to pay for any statutory holidays after the resignation date.

Consider Monday 24 October, which is a statutory holiday in NZ, and you normally work Monday - Friday (because your normal working days come into it also). You resign giving four weeks notice and are owed approx 3 weeks worth of leave. If your last day at work is Friday 28th then you have Monday 24 off and are paid. If your last day is Friday 14th then after Friday 14th you are no longer employed and you won't be paid for Monday 24th. If your last day is Friday 21st then, because your normal working days are Monday-Friday, Tuesday 25th is the next true working day for you, because Monday 24th is a stat day; and so you get paid for Monday 24th.

The amount of unpaid (owing) leave has nothing to do with it - it's all about your last day of employment relative to the statutory day. You should also note that if your resignation date was 21st, and your employer, because of the T's and C's of your employment contract, is able to require you to work on the stat holiday, with the usual compensation, then they can make you work 24th even though your resignation date is 21st!! (I've never seen anyone do that though).

All payroll systems should handle this correctly, albeit I have seen some that require this to be coded in, as this seems to be a construction unique to NZ. In any case, the employee should know their entitlements and should never accept the final payroll reconciliation without checking the handling of stat holidays.

cisconz

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#529552 5-Oct-2011 13:11

BlinkyBill: CISCONZ - This is not correct at all; companies would be breaking the law if they didn't make the payments as required and payroll systems are designed and implemented to uphold legal requirements.

They would be breaking the law, you are correct, payroll systems need to be setup correctly for this, I have found most are not, but that doesn't stop people doing it.
Technically it is illegal to price a magazine in a shop with anything other than a red marker (Mercantile Agents Act, 1908) but no one gets prosecuted over that.

BlinkyBill:The key thing on resignation is the resignation date. Once your resignation date is passed, you are no longer employed by the company, and the company isn't required to pay for any statutory holidays after the resignation date.

No you are employed until the period of your holiday pay is complete.

Further to this

http://www.acepay.co.nz/ersholfq.htm:
there is an entitlement only when
the employment is to be terminated; and
the balance of the employee's unused annual leave when added to the date of termination incorporates one or more public holidays.
This has been clarified in case law.

So, if he has unused leave, and then when you add this to his effective date of resignation, it now includes the Christmas/New Year public holidays and these days would have been days he would normally have worked had he not been leaving, then he is entitled to these days in addition to his holiday pay.

Hmmmm

bazzer

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#529560 5-Oct-2011 13:19

BlinkyBill:
Consider Monday 24 October, which is a statutory holiday in NZ, and you normally work Monday - Friday (because your normal working days come into it also). You resign giving four weeks notice and are owed approx 3 weeks worth of leave. If your last day at work is Friday 28th then you have Monday 24 off and are paid. If your last day is Friday 14th then after Friday 14th you are no longer employed and you won't be paid for Monday 24th. If your last day is Friday 21st then, because your normal working days are Monday-Friday, Tuesday 25th is the next true working day for you, because Monday 24th is a stat day; and so you get paid for Monday 24th.

The amount of unpaid (owing) leave has nothing to do with it - it's all about your last day of employment relative to the statutory day. You should also note that if your resignation date was 21st, and your employer, because of the T's and C's of your employment contract, is able to require you to work on the stat holiday, with the usual compensation, then they can make you work 24th even though your resignation date is 21st!! (I've never seen anyone do that though).

Personally, I don't find that any of this comment of yours makes sense. If your last day is the 21st, what does the next working day (25th) have to do with anything? Ditto for your comment about working after your last day. Do you have any links to legislation to back this up?

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John2010

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#529574 5-Oct-2011 13:35

If a public holiday falls after the last day of work but within the holiday pay period then the public holiday has to be paid too -

BUT that only applies if the public holiday is on a day one normally would have worked e.g. if you normally work Tuesdays to Saturdays then if Labour Day, being a Monday, falls in the paid holiday period after the last day of work then you do not get paid for Labour Day.

bazzer

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#529600 5-Oct-2011 14:48

John2010: If a public holiday falls after the last day of work but within the holiday pay period then the public holiday has to be paid too -

BUT that only applies if the public holiday is on a day one normally would have worked e.g. if you normally work Tuesdays to Saturdays then if Labour Day, being a Monday, falls in the paid holiday period after the last day of work then you do not get paid for Labour Day.

I think that's already been well established. BlinkyBill seems to contradict this though?

nate

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#529604 5-Oct-2011 15:07

If I'm self employed then quit and tell my boss to shove it, do I still get paid out?

(does that make any sense)

(yes I am kidding)

keewee01

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#529653 5-Oct-2011 16:00

Does it make any difference to the situation if you say gave notice that your last day of work as the 7th, and you worked to the 7th and then got paid out holidays you had owing beyond that? Would would your official last day be, say if you had 5 days of leave owing that was paid out. Is it the 7th, or would the leave be taken into account and it be the 14th?

John2010

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#529681 5-Oct-2011 16:23

bazzer:
John2010: If a public holiday falls after the last day of work but within the holiday pay period then the public holiday has to be paid too -

BUT that only applies if the public holiday is on a day one normally would have worked e.g. if you normally work Tuesdays to Saturdays then if Labour Day, being a Monday, falls in the paid holiday period after the last day of work then you do not get paid for Labour Day.

I think that's already been well established. BlinkyBill seems to contradict this though?

Perhaps I have missed something but it seems to me that people are saying that if a public holiday falls within the paid holiday period after leaving then one gets paid for it. That claim is INCORRECT.

As I set out one does not necessarily get paid for public holidays that fall in the termination paid holiday period.

I would not hold BlinkyBill's incorrect interpretation against him as the legislation is an absolute dog's breakfast.

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johnr

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#529683 5-Oct-2011 16:27

nate: If I'm self employed then quit and tell my boss to shove it, do I still get paid out?

(does that make any sense)

(yes I am kidding)

But you work at KFC

minimoke

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#529914 6-Oct-2011 09:12

The holidays Act is supposed to simplify what you are entitled to but it doesn't. To summarize the above posts here is a snapshot

In your first 12 months of work you DO NOT accrue annual holidays. Accountants will accrue the liability but an employee does not accrue the leave.

On your 12 month Anniversary you become entitled to four weeks annual holiday.

If you leave before you have worked 12 months you essentially get paid 8% of the gross earnings earnt during your employment.

If you leave after you have been there more than 12 months you get:
- the four weeks annual holidays you became entitled to on your anniversary date less any leave you have taken. (the calculation for this is a bit tricky - but its essentially based on total earnings which include overtime pay and bonuses) A bit hard to be a bit more precise without a concrete example.
- Now add your last day at work plus any days of untaken annual holidays. If a public holiday falls in that period you get paid the public holiday as well. (this is generally why employers are well advised not to fire people on christmas eve - they might be liable for 4 extra days public holiday)
- 8% of your earnigns from your anniversary date.

YadaMe

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#529949 6-Oct-2011 10:45

Actually, the department of labour website actually talks about all this, almost makes it easy....
http://www.dol.govt.nz/er/holidaysandleave/resignation/

the example shows someone finishing before labour day, but with holiday pay they get paid for labour day.

John2010

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#530074 6-Oct-2011 13:30

YadaMe:
... the example shows someone finishing before labour day, but with holiday pay they get paid for labour day.

Again, at the risk of labouring (

) the point they do not get paid for Labour Day if they do not normally work on Mondays e.g. if they normally work Tuesdays to Saturdays. Same applies for other public holidays.

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