Kia ora!
With the exciting and culturally significant Matariki Public Holiday just around the corner on 14th July 2023, we at Crystal Payroll would like to express our warmest wishes to you all. We hope that this long weekend will provide a unique opportunity to immerse in New Zealand’s rich cultural heritage and share memorable moments with your loved ones. This cultural event has recently become an official public holiday as detailed in the announcement by the Parliament of New Zealand.
This blog post provides guidance for our valued clients about the upcoming public holiday and how it will impact payroll processing. As your trusted payroll partner, we aim to ensure that you’re fully equipped to navigate these special circumstances.
What is Matariki?
Before we delve into the technicalities, let’s take a moment to understand what Matariki represents. Matariki is the Māori name for the cluster of stars known as Pleiades. The rise of Matariki in mid-winter heralds the start of the New Year in the Māori calendar. It is a time for remembering the past, celebrating the present, and planning for the future. Recognizing Matariki as a public holiday is a significant step forward in celebrating and acknowledging the unique culture and heritage of New Zealand.
Unlike standard holidays tied to specific Gregorian calendar dates, Matariki follows the Māori lunar calendar, usually landing in June or July each year. The inaugural Matariki public holiday will be marked on 14th July 2023. For the specific Matariki dates until 2054, based on the lunar calendar, check the official New Zealand government announcement.
Managing Payroll during Matariki
As part of the public holiday, Crystal Payroll will be closed on Friday July 14th and will open again on Monday July 17th, but we want to ensure you’re well-prepared for handling payroll during this time. To help navigate through the scenarios that may arise, here’s a handy guide to processing public holidays in our system:
Note that an “Otherwise working day” refers to a day where an employee would normally work if it wasn’t a public holiday. For a more detailed explanation of an “Otherwise working day” you can visit Employment New Zealand’s website.
Also, note that in order to know how many hours an employee should be paid (in the case that default hours are not preset), the Crystal Payroll system is able to calculate both the Average daily pay and the Average worked hours (Also known as Relevant daily pay). Employment New Zealand has provided a guide on what both of these calculations include and how to make the choice on which one to use. In general, using Relevant daily pay will always comply with the Holidays Act 2003.
There are four different scenarios when it comes to processing public holidays.
- Taking the public holiday off because it is a “Otherwise working day”
- Working on the public holiday on an “Otherwise working day”
- Working on the public holiday and it’s not an “Otherwise working day”
- Not working on the public holiday and it’s not an “Otherwise working day”
Scenario 1: “Otherwise working day”, taking the day off
If an employee would normally work on the day Matariki falls (an “otherwise working day”) and decides to take this day off, they will receive their usual pay.
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- First, consider if this employee normally works on the Friday which Matariki falls on. Then follow the next steps to add an entry for the paid Matariki day.
- Create an entry on the Matariki public holiday (14/07/2023). Enter the employee’s default hours in the Default Hours box. Skip to step 4 if the employee already has set default hours as it should be already automatically entered by the system.
Otherwise, follow the next three sub steps on how to correctly enter the employee’s calculated default hours.
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- Since the employee does not have preset default hours use the “i” to calculate the average worked hours.
- Pick one of the three options for the hours to be paid. The system has already automatically calculated both the Average Daily Pay and the Average worked hours. The first option “The default working hours for the day” will only be applicable if the employee has default hours. Otherwise you must select either the second or third option.
- Click Apply. (Make sure that the Worked Hours box has been left blank)
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- The employee will now get paid for the correctly calculated amount of hours for their public holiday at their usual pay rate. (Statutory Pay)
- Click “Save”.
Scenario 2: “Otherwise working day”, working on Matariki
Employees who work on Matariki when it’s an “otherwise working day” will receive their usual pay plus half (1.5x their normal rate) and will earn an alternative leave day (day in lieu).
- Create an entry on the Matariki public holiday (14/07/2023). Both the employee’s Worked Hours and Default Hours should be filled.
- Fill the Worked Hours box with the hours they worked on the public holiday. If the employee does not have preset default hours please use the “i” button as outlined in the next four sub steps.
- Since the employee does not have preset default hours use the “i” to calculate the average worked hours.
- Pick one of the three options for the hours to be paid. The system has already automatically calculated both the Average Daily Pay and the Average worked hours. The first option “The default working hours for the day” will only be applicable if the employee has default hours. Otherwise you must select either the second or third option.
- Click Apply. (Make sure that the Worked Hours box has been left blank)
- Now that both the Worked and Default hours have been filled, the system will automatically give the employee one day of alternative leave for the worked public holiday. They will also get paid 1.5 times their normal rate for the hours they worked.
- Click “Save”.
Scenario 3: Not an “otherwise working day”, working on Matariki
When an employee works on Matariki but it’s not their “otherwise working day”, they will get 1.5 times their pay rate without earning a day of alternative leave.
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- Create an entry on the Matariki public holiday (14/07/2023). ONLY fill the Worked Hours box with the hours the employee worked on the public holiday. Make sure to leave the Default Hours box blank.
- The system will know to only pay the employee 1.5 times their pay rate for the hours worked and that the employee will not be eligible to receive a day of alternative leave.
- Click “Save”
Scenario 4: Not an “otherwise working day”, not working on Matariki
In this situation, you don’t need to process an entry as the employee will not be paid for the day.
- There is no need to enter an entry at all as the employee does not need to be paid.
Remember, it’s crucial to ensure your employees are compensated correctly during this public holiday in accordance with New Zealand’s employment law.
Ensuring Compliance with Crystal Payroll
Mastering the complexities of payroll, especially during public holidays such as Matariki, is made simpler with Crystal Payroll. Our platform ensures you remain up-to-date and compliant with legislative changes, allowing you to focus on your core business operations.
Crystal Payroll ensures compliance across several critical areas:
- Tax Compliance: Automatic calculations for PAYE, Student Loan, Child Support, and ACC Levies.
- Leave Management: Simplified handling of various leave types, in line with the Holidays Act.
- Reporting: Comprehensive, legally compliant reporting for insights and transparency.
For updates on Matariki and other public holidays, the Matariki Public Holiday page on the Ministry of Business, Innovation and Employment’s website is a valuable resource.
As Matariki beckons, we invite you to discover how Crystal Payroll can simplify your payroll management. We are more than just a software provider; we are your partner in ensuring a seamless and compliant payroll experience.
Wishing You All a Happy Matariki!
As we prepare to commemorate Matariki, we wish you a joyful celebration filled with reflection and connection. As always, our team is here to support you through this public holiday and beyond. If you have any questions or need further assistance, don’t hesitate to reach out.
Ngā mihi nui, The Team at Crystal Payroll
