In this article we examine the calculation of a daily rate for an employee taking holidays after a full years service.
Section 21 covers the calculation of holiday pay after a full years service.
Calculation of annual holiday pay
(1) If an employee takes an annual holiday after the employee's entitlement to the holiday has arisen, the employer must calculate the employee's annual holiday pay in accordance with subsection (2).
(2) Annual holiday pay must be
Ordinary Weekly Pay
The daily rate of an employee taking a holiday requires the comparison of three different rates, and the selection of the greater.
In case you are confused by the above, don't be - Ace Payroll handles the complexity for you.
The following screen is automatically shown by Ace Payroll when paying holiday pay for an employee who is continuing their employment after a full year's service.
Note the three lines circled in yellow. These are the three calculations required by Section 21.
Clicking the Confirm Daily Rate button produces the following screen
Using the Annual Leave method, why is no current usual daily rate shown?
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