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Chris The Lawyer
Chris The Lawyer, Lawyer
Category: New Zealand Law
Satisfied Customers: 22315
Experience:  37 years qualified as a lawyer; LLB, MMgt and FAMINZ.
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We have a staff member on salary - to calculate a daily rate

Customer Question

We have a staff member on salary - to calculate a daily rate is the annual salary divided by 365 which would work out on a 7 day week or alternatively by 5 working day week?
Submitted: 1 year ago.
Category: New Zealand Law
Expert:  Chris The Lawyer replied 1 year ago.
That should be by 5 working days per week. The Holidays Act in sections 8 and 9 has definitions for holiday pay on weekly and daily rates which should apply to your question as well, even though it is not about the holiday rates.
Expert:  Chris The Lawyer replied 1 year ago.
8Meaning of ordinary weekly pay(1)In this Act, unless the context otherwise requires, ordinary weekly pay, for the purposes of calculating annual holiday pay,—(a)means the amount of pay that the employee receives under his or her employment agreement for an ordinary working week; and(b)includes—(i)productivity or incentive-based payments (including commission) if those payments are a regular part of the employee’s pay:(ii)payments for overtime if those payments are a regular part of the employee’s pay:(iii)the cash value of any board or lodgings provided by the employer to the employee; but(c)excludes—(i)productivity or incentive-based payments that are not a regular part of the employee’s pay:(ii)payments for overtime that are not a regular part of the employee’s pay:(iii)any one-off or exceptional payments:(iv)any discretionary payments that the employer is not bound, under the terms of the employee’s employment agreement, to pay the employee:(v)any payment of any employer contribution to a superannuation scheme for the benefit of the employee.(2)If it is not possible to determine an employee’s ordinary weekly pay under subsection (1), the pay must be calculated in accordance with the following formula: a − b c where—ais the employee’s gross earnings for—(i)the 4 calendar weeks before the end of the pay period immediately before the calculation is made; or(ii)if, the employee’s normal pay period is longer than 4 weeks, that pay period immediately before the calculation is madebis the total amount of payments described in subsection (1)(c)(i) to (iii)cis 4.(3)However, an employment agreement may specify a special rate of ordinary weekly pay for the purpose of calculating annual holiday pay if the rate is equal to, or greater than, what would otherwise be calculated under subsection (1) or subsection (2).
Expert:  Chris The Lawyer replied 1 year ago.
9Meaning of relevant daily pay(1)In this Act, unless the context otherwise requires, relevant daily pay, for the purposes of calculating payment for a public holiday, an alternative holiday, sick leave, or bereavement leave,—(a)means the amount of pay that the employee would have received had the employee worked on the day concerned; and(b)includes—(i)productivity or incentive-based payments (including commission) if those payments would have otherwise been received had the employee worked on the day concerned:(ii)payments for overtime if those payments would have otherwise been received had the employee worked on the day concerned:(iii)the cash value of any board or lodgings provided by the employer to the employee; but(c)excludes any payment of any employer contribution to a superannuation scheme for the benefit of the employee.(2)However, an employment agreement may specify a special rate of relevant daily pay for the purpose of calculating payment for a public holiday, an alternative holiday, sick leave, or bereavement leave if the rate is equal to, or greater than, the rate that would otherwise be calculated under subsection (1).(3)To avoid doubt, if subsection (1)(a) is to be applied in the case of a public holiday, the amount of pay does not include any amount that would be added by virtue of section 50(1)(a) (which relates to the requirement to pay time and a half).

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