December is here. With it is the reality that Christmas Carols are everywhere, and even the most reserved are putting up their trees and decking the halls. It also means that it is time to lock down the Christmas rosters and that means public holidays. Public holidays, and when and what to pay staff, is an area that causes a lot of angst with businesses. Operators are keen to ensure that they are “getting it right”, but it can be complicated. It is important to understand what the requirements are under the law and the employment instrument (usually the Award). Primarily it is important to remember that; when a public holiday falls on a day that a permanent employee is regularly rostered to work, that employee has the option to stay home without loss of pay, or to work (if asked) and receive not only their normal pay but an additional amount for working the public holiday.
Getting the public holiday basics right is vital
Public Holiday Basics: The Principle
The principle behind public holidays is that on a special occasion staff are entitled to take a day to celebrate without their base income being effected.
This entitlement is available to employees and is outlined in s115 of the Fair Work Act (FWA), which names; New Years Day (1 Jan), Australia Day (26 Jan), Good Friday, Easter Monday, Anzac Day (25 April), Queens Birthday, Christmas Day (25 Dec), Boxing Day (26 Dec), and any other day or part day proscribed by a State or Territory law to be observed generally as a public holiday.
For retail petroleum outlets, service stations, the Award that covers console operators, driveway attendants, roadhouse cooks and roadhouse attendants is the Vehicle Manufacturing, Repair, Services and Retail Award 2010 (VMRSRA) – https://www.fwc.gov.au/documents/documents/modern_awards/pdf/ma000089.pdf. The rates and clauses explored below pertain to the VMRSRA but the principles will apply to the Award covering wholesale fuel transport staff (Road Transport and Distribution Award 2010 – https://www.fwc.gov.au/documents/documents/modern_awards/pdf/ma000038.pdf) and clerical and support staff (Clerks – Private Sector Award 2010 – https://www.fwc.gov.au/documents/documents/modern_awards/pdf/ma000002.pdf)
Public Holiday Basics: Penalty Rates – a little extra to miss out on the celebration
Employers can ask an employee to work a public holiday when its reasonable, and employees can refuse to work a public holiday. However in most cases when they choose to work employees get a little extra payment for missing out on the celebrations.
As per the VMRSRA these rates change depending on the nature of the employment. For casual employees the public holiday rates are outlined in Clause 36. For permanent staff public holiday rates are outlined in Clause 43.3.
Public Holiday Basics: “No thanks, I’ll take the day off” – and still get paid
An employee does not have to say yes to a request to work on a public holiday. The public holiday exists so that the employee can take the day and celebrate, and if they choose to do that then they are able to do it without loosing their normal pay or dipping into their annual leave. If an employee choses to take the public holiday then most Awards provide for base ordinary hours for that day to be paid at the base rate.
Under the FWA, an employee who is absent on a day, or part-day, that is a designated public holiday is entitled to be paid at the base rate or “ordinary pay” for the “ordinary hours”.
Ordinary Pay or Base Rate is the ordinary income, excluding incentive-based payments and bonuses, loadings, overtime or penalty rate, monetary allowances, and any separately identifiable amounts. Ordinary hours are the ordinary time hours that are allocated to that staff member on that day.
If the staff member does not usually work that day then their ordinary hours for that day are said to be zero.
Public Holiday Basics: Do casuals get paid if they are not working?
A casual is engaged and rostered “as needed” this is seen under the law to be a day by day arrangement. Casuals are offered work, and if they choose to take it they can, and if they choose not to they are under no obligation to.
Because of this distinction casual employees are not said to be “rostered on a public holiday” until they accept to work on that day. For this reason there is no payment to a casual who is not working on a public holiday.
Casuals who do work are entitled to be paid for their time, and different Awards will stipulate different penalty rates, minimum shift lengths etc.
Public Holiday Rates – Time worked PLUS
When a full-time or part-time employee works a public holiday they have to be paid for the public holiday PLUS paid a premium or penalty for working on what should have been a day off for them (or time in lieu where agreed).
When calculating and communicating pay rates to staff there can be some confusion.
It is important to review the Modern Award, or employment instrument that the employee is engaged under to determine the rates and minimum hours to be offered.
ACAPMA members are reminded that ACAPMA can provide advice and support on the operation of public holidays in the industry, as well as resources on the calculation and application of public holiday rates.
What about Part Day Public Holidays?
Some States provide for Part Day Public Holidays, like Queensland Christmas Eve Public Holiday from 18:00-00:00 the night before Christmas, and South Australia’s New Years Eve Public Holiday from 19:00-00:00 the night before New Years Day.
Part Day Public Holidays are treated like regular Public Holidays but instead of applying for all 24 hours in the day, they only apply for those specific hours that the Government has gazzsetted.
What about Overtime?
As per the VMRSRA Clause 43.5, when required to work overtime on a public holiday, all employees, casual and permanent, are to be paid for a minimum of 3 hours
As per the VMRSRA Clause 43 when a permanent employee works overtime on a public holiday they receive double time for all time worked.
For example; if the ordinary hours were $10 per hour, overtime would usually be $15 per hour. To work out overtime on the public holiday rate you need to simply take the ordinary base rate ($10) and times by 2 to get double time ($20). It is NOT necessary to start with the everyday overtime rate ($15) and then times by 2 ($30).
As per VMRSRA Clause 36 when a casual employee works overtime on a public holiday they receive the public holiday rate PLUS the overtime rate.
For example; if a casual employee does overtime on a public holiday they receive the public holiday rate PLUS the overtime rate for their category of employment and their age, outlined in Clause 36.
Penalty Stacking? Weekends and Public Holiday rates. Do they combine?
The FWA does not outline standardised public holiday penalty rates. These are outlined in the Award. What the FWA and cases do outline is, that when two penalty rates could both apply at the same time, then the penalty that is most favourable to the staff member is the one that is used.
For example if the public holiday in question was a Saturday then the Saturday penalty and the Public Holiday penalty would be compared and the one that is higher is the one that is applied.
For example; if the ordinary pay was $10 per hour penalty rate for Saturday work was time and a half or $15 per hour, and the public holiday penalty was double time or $20 per hour. To work out the amount paid per hour you would start by first comparing the Saturday penalty and the Public Holiday penalty to establish which is the higher – then you would use that. It is NOT necessary to start with the Saturday rate of $15, then apply the public holiday penalty of double time, which would take it to $30 per hour.
It is important to note that certain Awards have differing penalties for different public holidays and for the treatment of public holidays that fall on a weekend, however these different provisions exist to ensure that it is clear that penalties do not “stack”.
What if an employee is on leave on a Public Holiday?
If a public holiday falls on a day that a permanent employee would usually have worked, and that employee is already on paid annual leave, long service leave, or personal or carers leave, then the ordinary hours for the public holiday should be credited back to the employee or the leave extended.
For example; Amy applied for 5 days annual leave, leaving her a balance in her leave entitlement of 20 days. As the business is on a monthly cycle she was then paid in advance for 5 days worth of ordinary hours (40). After the payment was made it was noted that a public holiday fell on the Monday of the leave period, and Amy usually works Mondays. In this case one day (8 hours) leave would be credited back to Amy taking her balance to 21 days. This crediting changes the 8 hours that were paid for that day from annual leave payment to public holiday payment.
The same process applies to personal and carers leave.
In terms of Long Service Leave, whether the leave will be extended based on a public holiday falling in the leave will depend on the State legislation. Credit back or extend leave in QLD, NSW, ACT, VIC, WA. DO NOT Credit back or extend leave in NT, SA, TAS.
If the payroll has not yet been processed then it is a simple matter of changing the allocations, rather than crediting back the leave. The point is that an employee does not miss out on that “paid day off to celebrate” even when they are on leave.
What if an employee is on Workers Compensation on a Public Holiday?
Whether an employee is entitled to be paid both the public holiday taken and the workers compensation amounts will depend on the State legislation that applies.
What if the site or business is shut down on a public holiday or has changed hours?
Many Awards provide for shutdown provisions to come into effect over the Christmas or Easter period.
VMRSRA 29.9 provides for the business to close-down up to three times a year, with some conditions. During a close-down employees with annual leave entitlements will be paid their annual leave, whereas employees who have not accrued enough annual leave to cover the whole close-down period will be paid annual leave until their accrued entitlement is exhausted. The application of this clause within the Award comes with some specific conditions, and requires the business or workplace to stop trading. Seek further advice before implementing close-down provisions.
Managing Public Holidays Onsite
When managing any aspect of employment onsite it is important to plan ahead. With public holidays this is especial. With enough notice items like shut down, planned leave, switching days and staff availability can all be assessed and implemented where required.
It is also helpful to consider equality over the holiday periods, if there are a large number of staff that are casuals consider asking them if they are interested in working the public holiday several rosters in advance. If the response rate is high, look at scheduling shorter shifts, so that everyone has a go.
State Public Holidays
States also have a list of public holidays that may differ. Most employment instruments and Awards provide for employees to have all gazetted State public holidays in addition to those outlined in the Fair Work Act. For a list of 2019 State Holidays please visit: https://www.australia.gov.au/about-australia/special-dates-and-events/public-holidays.
It is also important to note that Regional Public Holidays may apply in a businesses area of operations and will be treated as public holidays if applicable. For a list of 2019 Regional Holidays please visit: https://www.australia.gov.au/about-australia/special-dates-and-events/public-holidays.
ACAPMA Here to Help
Through the year ACAPMA Employment Professionals are available to assist members on 1300 160 270 or you can email email@example.com.
HR Highlights are things to consider, implement and watch out for in your business. They are provided as general advice and you should seek further advice on your situation by calling 1300 160 270 and speaking to one of ACAPMA Employment Professionals its free for members. ACAPMA membership is affordable at only $880 per year for a single site and valuable with sites gaining HR advice support and representation as well as a raft of other benefits and discounts. Visit: http://acapma.com.au/membership_information/ to apply for ACAPMA membership.
Elisha Radwanowski, BCom(HRM & IR)