Most of our clients close for ‘n period over Christmas, and each year we find that some confusion exists over all the public holidays over this time. Over-payments (as well as underpayments) occur because of uncertainty regarding what the Act says about public holidays.

The following public holidays occur over December, which will definitely have an effect on your payroll:

16 December 2017 – Day of Reconciliation (Saturday)

25 December 2017 – Christmas Day (Monday)

26 December 2017 – Day of Goodwill (Tuesday)

Let’s have a look at the implications of the above:

If your company only works from Mondays to Fridays, the 16th of December will not have an effect on anyone’s pay packet as it does not fall on a day that employees would have ordinarily work on. However, if employees at your company normally work on Saturdays, then the day would be payable in full even if no one worked on that day.

On the 25th and the 26th of December, most employers would have to pay their staff for a full day’s work even if no one worked on those days. However, there is a small possibility that a Monday and a Tuesday does not form part of certain employees’ ordinary working days, and then such employees would not qualify for a paid day. (Think for example of an employee who only works on Wednesdays, Thursdays and Fridays).

Employers also need to remember that if an employee worked on a public holiday, that employee needs to be paid double the wage he / she would have earned on a normal working day.

Should employees work overtime hours on a public holiday, such hours are also then paid at double the hourly rate they would normally be paid at.

The last aspect one needs to consider is how to calculate the annual leave days where a leave period contains public holidays.

To practically illustrate this, let’s take a situation where a company’s last working day is the 15th of December, and it only opens again on the 15th of January 2018.

In December, this would translate to 8 leave days taken (the 18th, 19th, 20th, 21st, 22nd, 27th, 28th and 29th of December 2017) and in January to 9 days leave (the 2nd, 3rd , 4th, 5th, 8th, 9th, 10th, 11th, and 12th of January 2018). In total the employee would have had 20 working days’ off, but only 17 can be deducted from his / her accrued leave days. The other 3 days are public holidays.

Employers need to remember these rules before deciding on their annual closure dates, as employees who have not accrued enough leave days by December, will be left out of pocket over the festive season.