The employees’ union successfully argued in the Supreme Court that the collective employment agreement did not comply with the requirements of Section 44(2) of the Holidays Act.
Section 44(2) allows an employer and employee to agree that any public holiday specified in the Act is to be observed by the employee on another day.
On closer inspection of the collective agreement itself the Court held that the arrangement between the employer and employees was not an agreement that the employee would observe the public holiday on another day, rather it was an agreement that provided for working on a public holiday, without being paid time and a half.
The Holidays Act has a strong focus on the need to pay time and a half for working on a public holiday. When this entitlement was being debated in Parliament, there was never any suggestion that matters could be arranged so that an employee might work on a public holiday and not be paid time and a half.
The power vested in employers in Section 44(2) was not a power to agree that a public holiday could cease to be a public holiday. Redefining public holidays in such a way undermines the concept of a “public holiday”.
The result of this case serves as a timely reminder for employers that they must pay their employees time and half for working on a public holiday. It is the employees right to be compensated for working on a day that the public at large have as a holiday. An employer cannot “contract” out of the existence of public holidays. Despite the ruling in this case however, I want to make it clear that it is still possible for an employee to take a public holiday on a day other than that specified in the Act, as long as there is agreement of both parties, (and that employee is paid time and a half for any work done on the actual day of the public holiday). Employers must be careful when putting these sorts of clauses in employment agreements though, to ensure that they do not infringe on the rights of employees.
This article originally appeared in the Southland Times Work To Rule column. Mary-Jane Thomas is head of Preston Russell's employment law team. Contact her by clicking here
