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How is regular overtime paid if it occurs on Australia Day?

This question was recently sent to our Workplace Advice Line.
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How is regular overtime paid if it occurs on Australia Day?

How is regular overtime paid if it occurs on Australia Day?

14 January 2021

By Siobhann Provost

This question was recently sent to our Workplace Advice Line.

Q We have several administrative staff who regularly work two hours overtime on Tuesdays. With the Australia Day holiday falling on Tuesday, we're unsure how these employees should be paid. Should we just pay them for their ordinary daily rate? Or are they entitled to receive two hours overtime pay for the Australia Day public holiday, despite not working on the day?

They are employed under the Clerks – Private Sector Award 2010.

A Like most modern awards, the Clerks – Private Sector Award 2010 refers to the National Employment Standards in relation to public holidays. This means the relevant provisions in the Fair Work Act would apply.

The employees would NOT be entitled to payment for regular overtime usually performed on the day the public holiday falls, where no work is performed.

Under the Fair Work Act (s116), an employee is to be paid at their base rate of pay for a specified public holiday. ‘Base rate of pay’ is defined as the rate of pay for an employee's ordinary hours of work, but not including incentive-based payments and bonuses, loadings, monetary allowances, overtime or penalty rates or any other separately identifiable amounts.

This means overtime is not considered part of an employee’s ‘base rate of pay’ when paying an employee who is absent on a designated public holiday.


Modern awards

While it is possible for a modern award to contain terms that provide a more beneficial definition of ordinary pay when an employee is absent on a public holiday, the Clerks – Private Sector Award 2010 is silent on this point, therefore the provisions relating to payment for a public holiday prescribed by the Fair Work Act apply.

The bottom line: Regular overtime is not payable when an employee is absent from work due to a public holiday as it is not included in an employee’s base rate of pay.
 

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