| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | AA 112/06 |
| Hearing date | 27 Feb 2006 |
| Determination date | 05 April 2006 |
| Member | M Urlich |
| Representation | PG Phillips (in person) ; P Kiely |
| Location | Auckland |
| Parties | Phillips v Hauraki Marine Ltd |
| Summary | ARREARS OF HOLIDAY PAY - DISPUTE – Calculation of holiday pay and recovery of payment for in lieu days applicant alleged should have been paid when employment ended – Employment agreement provided for bonus – Applicant alleged salary plus bonus payment should have been used as divisor to calculate average weekly earnings – Respondent alleged that payment did not include the bonus as it did not fall within the relevant 12 month period – Respondent calculated entitlement on 6 January 2005 (applicant’s anniversary date) – Applicant worked until 4 June 2005, at which time respondent calculated holiday pay entitlement on that portion of the year – Whether bonus was a regular part of ordinary weekly pay – Employment agreement anticipated payment of bonus on annual basis once express conditions met – Bonus regular payment to be included in calculation of ordinary weekly pay – Payment must form part of calculation for ordinary weekly pay – Applying formula in s8(2) Holidays Act 2003 resulted in grossly inflated ordinary weekly pay which could not be correct – Most straightforward calculation was to divide applicant’s gross salary and bonus earnings for the 12 months preceding termination by 52 and add those two figures together – That calculation provided practical outcome for parties – Whether bonus should be included in calculation of average weekly earnings – Payment of bonus made after the last pay period on 31 May – Ordinary weekly pay calculation therefore greater than average weekly earnings and was the one to be used – Respondent to recalculate applicant’s holiday pay entitlement in accordance with s26 – No need to resolve dispute about number of lieu days |
| Result | Orders accordingly ; Disbursements in favour of applicant ($70) |
| Statutes | Holidays Act 2003 s5(1);Holidays Act 2003 s8(1)(c)(i);Holidays Act 2003 s24;Holidays Act 2003 s24(2);Holidays Act 2003 s24(2)(b);Holidays Act 2003 s25;Holidays Act 2003 s25(2);Holidays Act 2003 s26 |
| Number of Pages | 5 |
| PDF File Link: | aa 112_06.pdf [pdf 29 KB] |