5 things to keep in mind when running payroll for public holidays in New Zealand

This is a photo of a person's hands at a computer desk. They are typing into a calculator and processing payroll. There is the KeyPay logo in the top left corner of the photo.

From Waitangi Day to Easter, public holidays are abundant in New Zealand. But for some, the prospect of payroll on public holidays may be on the brain. For accountants, bookkeepers and outsourced payroll providers, running payroll can be complex. With employees on various agreements and working hours, this can be daunting - let alone throwing a public holiday into the mix.

When it comes to public holidays in New Zealand, there’s a few important things to remember when processing payroll for clients. Here’s 5 things to keep in mind:

1. Employees who work on a public holiday

Depending on the nature of your client’s business, not all employees may be working on the day that the public holiday falls on. 

  • If the public holiday is a normal working day: Your client’s employees must be paid at time and a half for their hours worked - and they are also entitled to earn an alternative holiday.
  • If the public holiday is not a normal working day and your clients’ employees agree to work on that day: They will only be paid time and half for their hours worked.

Some helpful definitions:

Alternative holiday = an extra day off for employees who have to work on a public holiday that would usually be a normal work day. This day off does not expire, and may be paid out if the employee hasn’t taken it within 12 months of becoming entitled to it.

Normal working day = a day that is an otherwise working day for the employee

2. Employees on leave during public holidays

If your client’s employee takes annual leave during a public holiday, they are entitled to be paid for the public holiday rather than using their own annual leave on that day. However, this doesn’t apply to leave without pay (in some cases) - so public holiday entitlements will not be paid in this situation.

3. Public holidays falling on a weekend

If a public holiday falls on a Saturday or Sunday, your client’s employee’s public holiday may be transferred to the following Monday (or Tuesday, in some cases). This is where Mondayisation comes into play:

  • If the public holiday calendar date falls on the weekend and is a normal working day: The employee’s public holiday will not be Mondayised - if they work on that day, they will be paid time and a half and accrue an alternative day. If they don’t work on that day, they will need to be paid their relevant daily pay for the day.
  • If the public holiday calendar date falls on the weekend and is not a normal working day: The employee’s public holiday will be Mondayised.

4. ANZAC Day and restricted trading

It’s important to note that ANZAC Day is a restricted trading day for retail stores and shops that sell goods to the public. Your clients who fall under this criteria will only be able to open after 1pm, meaning that their employees can only work from this time. 

Take a look at MBIE for more information on ANZAC Day trading and paying your clients’ employees on this day.

5. Automating public holidays within your software

It can be tricky to find payroll software that automates public holidays; many have the statutory holidays built into the system, but calculating and feeding these through to the pay run is another story.

At KeyPay, we strive to make life easier for you and your clients. If you run payroll for businesses whose employees use timesheets, say hello to our WorkZone and ClockMeIn apps! You and your clients can benefit from ‘otherwise working days’ (a day that an employee would have been working, had it not been for a public holiday) being automatically determined by the system, which then generates public holiday earnings from the timesheets. 

This is a win-win; you’ll save so much time from having to manually calculate payment for your clients, who will be more satisfied with your services, as their employees are being paid correctly!

For more information on this, check out our article on Public Holiday Entitlements.


The Matariki Public Holiday Bill passed last year - which means that the first public holiday to celebrate Matariki was on Friday 24 June 2022. Take a look here for more information on the new public holiday.

If you’re struggling to run payroll for Kiwi businesses with complex and irregular work patterns, consider trying out software that streamlines public holidays for you.

Look no further than KeyPay, and find out why we’re trusted by over 750 partners who run payroll for over 200,000 businesses globally!

This blog was last updated on 30 January 2023, and will continue to be updated with relevant information as necessary.

Sophie Borton-Sutherland

NZ Partner Marketing

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