What happens when an employee resigns over the holiday season?

It is important to pay employees correctly for public holidays. In some circumstances an employee may be entitled to be paid for a public holiday which falls after the date the employment has ended.  This will happen when an employee is entitled to annual leave which remains owing at the time the employment comes to an end.

The employer must treat any annual leave that the employee is entitled to (or other leave which it is required to pay the employee) as taken immediately after the date the employment ended.  The employee may be paid for a public holiday if it happens in the time period created by adding on the leave to the end of the employment.

The public holiday must fall on a day when the employee would have worked if they were still employed and the day was not a public holiday. This has no actual effect on the end date of the employment.

For example, an employee’s last day of work is 24 December and they have one day of leave to be paid by the employer. The day of leave is added on to the final day of work which extends the relevant period to 25 December. This is a public holiday which the employee would usually work (if the employment had not come to an end) depending on which day of the week it falls on. Therefore, the employee is entitled to be paid for this day.

The day of leave would then be extended (by the public holiday on the 25th) to 26 December (which is also a public holiday) so the process described above would repeat. The employee would be paid for the next day of work which would usually fall on 27 December. This is not a public holiday and so the employee’s entitled leave day would fall to be used on this day.

If the employment came to an end and the employee had sufficient leave, they may be entitled to be paid for Christmas Day, Boxing Day, New Years’ Day and the Day After New Years’ Day as well as their entitled annual leave despite that the last day of work was before the holiday period.

They are also to be paid for any accrued annual leave to which they have not yet become entitled. Those accrued annual leave days do not extend the calculation for Public Holidays as they are not yet entitled to that leave and it is only days they are entitled to (not accrued) that extend the calculation for Public Holiday purposes.

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