Public holiday substitution is a mechanism that allows an employer and employee to agree that a public holiday will be observed on a different date. Rather than taking the public holiday on the nationally recognised date, the employee works on the public holiday and takes the replacement day off instead. This is particularly relevant for employers in industries that operate on public holidays, such as hospitality, healthcare and emergency services, where staffing on public holidays is essential.
Key Takeaways
- Public holiday substitution is only valid if both the employer and employee genuinely agree
- In Australia, the Fair Work Act requires the agreement to be in writing and must not unreasonably refuse the employee’s preferred date
- In New Zealand, the Holidays Act 2003 allows substitution by agreement, with the replacement day treated as the public holiday for all purposes
What Public Holiday Substitution Means for Employers
Public holiday substitution offers operational flexibility. For a restaurant that must open on Christmas Day, substitution allows the employer to offer staff an alternative day off without being required to pay public holiday rates on the actual holiday. However, the substitution must be genuinely voluntary. The Fair Work Commission has warned that blanket substitution agreements, where employees are required to sign as a condition of employment, may not satisfy the genuine agreement requirement.
In Australia, the Fair Work Act 2009 (Cth) section 115(1) allows the employer and employee to agree on a different day for the public holiday. The agreement must be in writing. The employee must still receive the same entitlements (public holiday pay and conditions) on the replacement day as they would have received on the original public holiday.
In New Zealand, the Holidays Act 2003 provides a similar mechanism. Under section 45, the employer and employee can agree in writing to observe the public holiday on an alternative day. The replacement day is treated as the public holiday for all purposes, including pay and conditions.
In the UK, there is no statutory public holiday substitution mechanism. Bank holidays are fixed dates, and employers must either grant the bank holiday or provide the equivalent day off at another time by agreement.
Public Holiday Substitution Rules by Region
| Country | Rule | Detail |
|---|---|---|
| UK | No statutory substitution | Bank holidays are fixed dates; employers can agree to grant the day off at another time by mutual agreement |
| AU | Fair Work Act 2009 s.115 | Employer and employee can agree in writing to observe the public holiday on a different day |
| NZ | Holidays Act 2003 s.45 | Employer and employee can agree in writing to observe the public holiday on an alternative day |
How Public Holiday Substitution Works in Practice
A Sydney café operates every day of the year, including public holidays. For the Australia Day public holiday, the café owner proposes that all employees work on 26 January and take 26 January off on a mutually agreed alternative date. Three employees agree to work on Australia Day and take 28 January off instead. The agreement is documented in writing, specifying the original public holiday date, the replacement date and the employee’s consent.
On 26 January, the three employees work ordinary hours and are paid at their ordinary rate (not the public holiday rate), as the public holiday has been substituted. On 28 January, they have the day off and are paid as if it were the public holiday. The café maintains full staffing on the public holiday while respecting the employees’ entitlement to a day off.
Common Mistakes with Public Holiday Substitution
- Implementing blanket substitution agreements without genuine individual consent, which may be challenged
- Not documenting the substitution agreement in writing, as required by the Fair Work Act in Australia
- Requiring employees to work on a public holiday as a condition of employment, which may constitute coercion
- Not providing the same pay and conditions on the replacement day as would have applied on the original public holiday
- Applying substitution to employees who have a religious or cultural objection to working on a specific public holiday without considering reasonable adjustments
FAQ
What is public holiday substitution?
Public holiday substitution is an agreement between an employer and employee to observe a public holiday on a different date. The employee works on the actual public holiday and takes the replacement day off instead.
Can my employer make me substitute a public holiday?
No. In Australia, the Fair Work Act requires genuine agreement from the employee. Blanket substitution agreements may not satisfy this requirement. In New Zealand, the Holidays Act also requires written agreement.
Does substitution affect my pay?
On the replacement day, you receive the same pay and conditions as you would have received on the original public holiday. If you work on the actual public holiday, the substitution may affect whether you receive public holiday rates.
leave emails? Track your employee's leave with Leave Balance
