A small employer recently had problems with its cleaner and tried to enforce standards regarding the cleaning done.  Despite promises, the cleaner did not improve and decided to leave his employment.

The employer and employee had entered into the employment agreement on the basis that the employee would be paid an hourly rate, and not be paid for any additional holiday pay, statutory holidays, time in lieu, and time and a half.

When the employee resigned after several years’ employment he claimed for holiday pay, statutory holidays, time in lieu, and time and a half for statutory holidays worked.

The Employment Relations Authority awarded the employee over $13,500 for these unpaid wages as it is illegal to contract out of the Holiday’s Act, and therefore the employee was entitled to be paid all these entitlements from the start of their employment.

You cannot wrap up all holiday entitlements into a single pay rate; they must be paid separately and on top of the pay rate.  Holiday pay (apart from a specific exception in the Act) must be paid at the time of the holiday and not with the normal wages. Many employers have ended up paying holiday pay twice after paying it as part of the normal pay cycle rather than at the time of the holiday.

If you need help getting your holiday pay entitlements sorted call me on 04 473 6850 for an initial chat.