Regular payments

The regularity of payments (for example, overtime or allowances) is a consideration for determining the rate you get paid when you take annual leave[1].

  • Fixed allowances, which are paid at same amount every time and paid every week, are automatically included in your Ordinary Weekly Pay (OWP).
  • Some payments, like overtime or standby allowances, are variable because they don't have a consistent amount or frequency. If you've received payments which could vary, we've used the 4-week average formula. We included these payments if you've received them for three of the four weeks within the qualifying period (‘qualifying period’ meaning the four weeks prior to the pay period in which you took the annual leave).

Some examples:

1. Tony’s usual work pattern is: Monday–Friday 10am–6pm. Tony has been working additional hours, as the team has some extra work.

Pay periodWeekAdditional hoursAssessing payment for
annual leave
Pay period 1 Week 1 Thursday + 2hrs
Tuesday + 2hrs		 Worked OT
Week 2 Friday + 2hrs
Tuesday + 2hrs		 Worked OT
Pay period 2 Week 3 No extra hours OT not worked
Week 4 Wednesday + 3hrs Worked OT
Pay period 3 Week 5 No extra hours OT not worked
  Week 6 Tony took annual leave  

In assessing the pay rate for the leave Tony took in Week 6, the Ministry remediation will use the 4-week average in place of OWP, including the OT payments for weeks 1, 2, and 4.

2. Sally works in the same team as Tony. Sally’s also working additional hours, but they're different to Tony's.

Pay periodWeekAdditional hoursAssessing payment for
annual leave
Pay period 1 Week 1 No extra hours OT not worked
Week 2 Tuesday + 1hr Worked OT
Pay period 2 Week 3 No extra hours OT not worked
Week 4 Friday + 1hr Worked OT
Pay period 3 Week 5 No extra hours OT not worked
  Week 6 Sally took annual leave  

In assessing the pay rate for the leave Sally took in Week 6, the Ministry remediation will use Sally’s standard OWP, excluding the OT payments for weeks 1 and 2.

For both examples, the 4-week average or OWP rate used will be compared with Tony and Sally’s Average Weekly Earnings (which include all OT payments) and the greater rate will be used.

If you think this approach doesn't adequately meet the entitlements for your circumstances, please send your specific information to Holidays Act Payments. so we can review how we'll address your situation.

[1] Which is the greater of Average Weekly Earnings (AWE) compared with EITHER the Ordinary Weekly Pay (OWP) OR the 4-week average.

 
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