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  • Paying employees for closedown periods


 

 

ANSWER ID:4410

The method for paying employees Annual Holiday during a closedown period varies depending on whether an employee is entitled to Annual Holidays or not. Employees are entitled to Annual holidays after 12 months of continuous employment.

 

 

 

Employees entitled to Annual Holidays
Employees should be paid annual leave, in other words use the Annual Holidays (ANHL) paycode. If employees do not have enough annual leave to cover the closedown period the employer and employee may agree to pay annual leave in advance.
Employees not entitled to Annual Holidays

An employer and employee can agree to take the period of the closedown as Annual Holidays in advance using the ANHL paycode. Otherwise the following method applies:

If an employee is not entitled to Annual Holidays but is required to observe the closedown period the employer must pay the balance of Holiday Pay (HP) accrued since employment began or the employee last became entitled to Annual Holidays. If this is done the employees Holiday Anniversary date should be changed to be 12 months from the start of the closedown period.

  FAQs


What is a Common Anniversary Date?

If Payroll has been set to use a common anniversary date (go to the Tools menu and choose Options then click the Leave tab) then the above methods apply except that the anniversary date for an individual cannot be changed. So an employee who is not yet entitled to Annual holidays it is best to either pay out all Holiday Pay (HP) accrued up to the Common anniversary date or convert holiday pay to annual leave (go to the Tools menu and choose Options then click the Leave tab).

see Common anniversary date for more information.