The Holidays Act 2003 states that an annual leave rate should be calculated at the start of the employee’s leave and be used for the entire duration instead of being updated each pay period.  This includes leave across pay periods, as long as the leave taken is continuous.  Annual leave is defined as continuous if there is no return to work. 

This process is now automated in DataPay, with the functionality enabled for all companies in New Zealand environments by default.

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If there are multiple pay packets for an employee in a period, it is strongly advised that all leave requests are applied to the Main pay packet. Failing to do so may prevent continuity from being detected and all leave requests would could be marked as Not Start Continuous.

Payment for continuous annual leave

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In the above example, the left pay packet includes Annual Leave Taken on April 30th, which was paid at the ordinary rate of $40.86617. In the following pay packet to the right, the Annual Leave Taken on May 1st is continuous with Annual Leave Taken on April 30th, so it is paid at the same rate despite the ordinary rate being higher in that period ($42) 

Annual Leave Paid at Parental Rate

This works the same as paying at the non-parental rate. If the employee uses up all of their parental leave, the non-parental rate as at Start Continuous will be used.

If an employee uses up all of their remaining parental rate leave and continues to take annual leave in a continuous period, the non-parental leave will be paid at the rate of the parental leave calculated in the first leave request.

What if I want to pay more?

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