Managing payroll during public holidays can feel like a headache, especially when youโre busy getting ready for the extra crowds. You want to do the right thing by your staff, but figuring out the correct public holiday penalty rates and entitlements can get confusing.
In Australia, employees get a bunch of national public holidays, plus some territory-specific ones. On these days, they can usually take the time off with their regular pay. But what happens when you need them to come in and help out?
For certain industries, additional staff can be used to maximise public holidays. With good reason, you may ask employees to come in, but youโll need to pay them based on the public holiday penalty rate.
Below, we go over the typical employee entitlements and how they may affect your payroll compliance. Use the information before planning your staff roster or hiring more employees over the holiday season.
Understanding public holiday wages
Holiday wages are a part of Australiaโs employment standards, guided by the National Employment Standards (NES) and Enterprise Agreements. What you pay also depends on the relevant Modern Award or Territory Award for your industry.
If you have full-time and part-time staff who work on a public holiday, you can agree to give them a day off on a different day, or extra annual leave thatโs equal to the time they worked. If they take the day off, it has to be within four weeks of the public holiday. If not, youโll need to pay them the penalty rate instead.
Find out more about public holidays here.
Keep in mind, employees can say no to working on a public holiday, especially if they have a good reason. If the public holiday falls on a day they would normally work, they’re entitled to their base pay even if they donโt work.
To avoid being short-staffed, plan ahead. Figure out who you need, calculate the penalty rates, and give your employees plenty of notice.
How to calculate public holiday penalty rates
According to Fair Work, penalty rates can change based on the Modern Award that applies to your business or any specific agreement you have with an employee. When an employee works on a public holiday, the penalty rates often fall into these types:
- Double-time pay: The employee is paid twice their normal hourly rate.
- Double-time-and-a-quarter pay: The employee is paid 2.25 times their normal rate,
- Double-time-and-a-half pay: The employee is paid 2.5 times their normal hourly rate.
- Casual employee penalty pay: This widely varies depending on the relevant Modern Award, but is usually 25-50% more than the penalty pay for part-time and full-time employees.
Let’s look at an example. Danielle is a full-time retail worker who earns $27.17 an hour. The General Retail Industry Award says that full-time employees get 225% of their normal hourly rate on public holidays. So, if she works on Good Friday, she would get paid $61.13 per hour.
Public holiday penalty rates per industry or Modern Award
| Industry/Award | Full-time or part-time employees | Casual employees |
|---|---|---|
| Real Estate | ||
| Horticulture | ||
| Fast Food/Takeaway | ||
| Hospitality | ||
| Restaurant/Cafe | ||
| Retail | ||
| Children’s Services | ||
| Clerks (Private Sector) | ||
| Hair & Beauty | ||
| Manufacturing | ||
| Social, Community, Home Care & Disability | ||
| Vehicle Sales & Repair | ||
| Building & Construction | ||
| Health Professionals & Support Services | ||
| Security Services | ||
| Storage & Wholesale | ||
| Cleaning | 260% for part-time | |
| Road Transport & Distribution |
Other public holiday entitlements you should know about
Just like penalty rates, other entitlements can be different depending on the state and territory youโre in. Knowing them helps you plan your small business payroll and avoid any surprises.
Right to be absent from work
In general, employees can be away from work on a public holiday without losing pay or annual leave. The only time this changes is if they’re required to work because of their job or if they’ve already agreed to it.
Extra annual leave
In some states and industries, employees can get an extra day of annual leave if they work on a public holiday. This is sometimes called a lieu day. If an employee takes this, you don’t have to pay them the public holiday rate.
Minimum shift length
Some awards say that if employees work on a public holiday, they have to be paid for a minimum number of hours, even if their shift was shorter.
Substitute public holiday for another day
An employee might swap a public holiday for another day. This often happens if the public holiday falls on a day they wouldn’t normally work or if it’s not a convenient day for your business.
Handling payroll for hours worked on public holidays
Itโs easy to feel overwhelmed by all the different rates and rules, especially during the busy holiday season. Leveraging flexible payroll software like Payroller can help simplify the process. With Payroller, youโll spend less time ensuring accurate calculations and adding leaves or entitlements to match your business needs. Our system takes care of it, making sure you can pay your team quickly and accurately.
Beyond paying your employees, you can effectively manage shift assignments and employee communications from Payrollerโs platform. Our timesheet app and online rostering capabilities will let you set shifts and send them to employees directly for them to accept and decline. This makes it easier to plan for the holidays and comply with Australian labour laws.
Frequently asked questions about paying employees working public holidays
Can employees work during public holidays?
Generally, yes, employees can work during public holidays. However, they are typically entitled to a higher pay rate for working on these days.
Your request to have employees work on public holidays should be reasonable based on NES guidelines:
- The nature of your workplace and the work of the employee
- The employeeโs personal circumstances, such as family responsibilities
- Whether the employee reasonably expects your request to work on a public holiday
- Whether the employee is entitled to receive overtime, penalty rates, or other compensation
- The employeeโs employment type
- The amount of notice given to the employee to work on a public holiday
- The amount of notice given to you by the employee when declining
Can employees substitute public holidays for leave on a different day?
In some cases, yes, employees may be able to substitute a public holiday for leave on a different day. This is often referred to as โlieu day leaveโ or โpublic holiday leave.โ
Can employees take sick leave during public holidays?
Yes, employees can take sick leave during public holidays. If an employee is unable to work due to illness on a public holiday, they are typically entitled to paid sick leave.
How are casual staff paid for public holidays?
Casual staff do not automatically get public holiday pay unless through an agreement with the employer or a relevant Modern Award.
How are employees paid outside of the state during public holidays?
Public holiday entitlements generally apply based on the location where the employeeโs employment contract was entered into. There might be exceptions in specific cases, such as if an employee is temporarily working in another state due to the employerโs requirements.
Do new employees have a qualifying period before getting public holidays?
New employees are not required to complete a qualifying period before being eligible for public holiday entitlements.