Annual Leave and Public Holidays: What Happens When They Overlap

Published: December 2024 | Reading time: 8 minutes

Planning annual leave around public holidays is one of the smartest ways to maximize your time off work. But what happens when a public holiday falls during your annual leave period? Do you lose that day, or is it treated separately? Understanding how public holidays interact with annual leave is essential for savvy leave planning and ensuring you receive all your entitlements.

This guide explains everything you need to know about the relationship between annual leave and public holidays in Australia.

The Golden Rule: Public Holidays Don't Reduce Your Leave

Under Australian employment law, if a public holiday falls during a period of annual leave, it does not count as a day of annual leave. Instead, you're entitled to the public holiday as a separate entitlement. This means your annual leave balance is preserved, and you effectively get an extra day off.

For example, if you take two weeks of annual leave over the Easter period, the public holidays (Good Friday and Easter Monday) are not deducted from your leave balance. You receive those days as public holiday entitlements, and only the non-holiday weekdays are counted as annual leave.

This rule is established in the National Employment Standards under the Fair Work Act 2009 and applies to all permanent employees covered by the national workplace relations system.

How This Affects Your Leave Planning

This interaction between public holidays and annual leave creates excellent opportunities for strategic leave planning. By timing your leave around public holidays, you can extend your breaks while using less annual leave.

Christmas and New Year Example

Consider the Christmas-New Year period. With Christmas Day, Boxing Day, and New Year's Day as public holidays, plus weekends, you might only need to use 3-4 days of annual leave to take approximately 10 days off. The public holidays are additional days that don't consume your leave balance.

Easter Example

Easter typically includes Good Friday and Easter Monday as public holidays. Take the Tuesday to Thursday as annual leave (3 days), and you get a 10-day break including the preceding and following weekends, using only 3 days of leave.

Long Weekend Extensions

For holidays like Australia Day or Anzac Day that create long weekends, taking the Friday or Tuesday adjacent to the weekend can give you a 4-day break using just 1 day of annual leave.

Which Public Holidays Apply?

Australia has a mix of national and state-specific public holidays. The national public holidays are:

• New Year's Day (January 1)
• Australia Day (January 26)
• Good Friday
• Easter Saturday
• Easter Monday
• Anzac Day (April 25)
• Queen's Birthday (varies by state)
• Christmas Day (December 25)
• Boxing Day (December 26)

States and territories may also have additional public holidays, such as Melbourne Cup Day in Victoria or Adelaide Cup Day in South Australia. Your entitlement to each public holiday depends on where you work, not necessarily where you live.

What If You're Asked to Work on a Public Holiday?

While annual leave generally protects you from working, you might be asked to cut your leave short to work on a public holiday. You have the right to refuse a request to work on a public holiday if you have reasonable grounds. Being on pre-approved annual leave is typically considered a reasonable ground for refusal.

However, if you agree to work on a public holiday during what would otherwise be annual leave, you should receive public holiday penalty rates for the hours worked, and only the hours actually taken as leave should be deducted from your balance.

Public Holidays That Fall on Weekends

When a public holiday falls on a weekend (and you don't normally work weekends), many holidays are "observed" on the following Monday. For example, if Christmas Day falls on a Saturday, the Monday after would typically be a public holiday in lieu.

If you're taking annual leave that week, the Monday substitute public holiday would not count as annual leave, just as the original holiday wouldn't have. Check your state's specific rules, as the treatment of substitute days can vary.

Part-Time Employees and Public Holidays

For part-time employees, the interaction between annual leave and public holidays requires some additional consideration. If a public holiday falls on a day you would normally work, it's treated as a public holiday entitlement. If it falls on a day you wouldn't normally work, it doesn't affect you either way.

When taking annual leave, only the hours you would normally work are deducted from your balance, and any public holidays that fall on your regular working days are excluded from this deduction.

Calculating Your Actual Days Off

To illustrate how this works in practice, let's look at a detailed example:

Scenario: A full-time employee (Monday to Friday) takes annual leave from Monday, December 23 to Friday, January 3.

Breakdown:

• Monday, December 23: Annual leave (1 day)
• Tuesday, December 24: Annual leave (1 day)
• Wednesday, December 25: Public holiday (Christmas Day)
• Thursday, December 26: Public holiday (Boxing Day)
• Friday, December 27: Annual leave (1 day)
• Saturday-Sunday: Weekend
• Monday, December 30: Annual leave (1 day)
• Tuesday, December 31: Annual leave (1 day)
• Wednesday, January 1: Public holiday (New Year's Day)
• Thursday, January 2: Annual leave (1 day)
• Friday, January 3: Annual leave (1 day)

Total time away: 12 days (including weekends)
Annual leave used: 7 days
Public holidays: 3 days (not counted as leave)

Employer Shutdown Periods

Many employers close during certain periods, particularly around Christmas and New Year. If your employer shuts down, they can direct you to take annual leave during the closure, provided certain conditions are met:

• Reasonable notice is given (usually at least 14 days)
• The direction is reasonable in the circumstances
• If you don't have enough accrued leave, arrangements must be made (leave in advance or unpaid leave)

Even during shutdown periods, public holidays remain separate from annual leave. You won't have annual leave deducted for public holidays during a shutdown.

Tips for Strategic Leave Planning

To maximize the benefit of the public holiday rule:

1. Map out the year's public holidays at the start of the year
2. Identify "bridging" opportunities where taking 1-2 leave days creates extended breaks
3. Book leave early for popular periods like Easter and Christmas
4. Consider state-specific holidays if you live in a different state than you work
5. Check your award for any additional holidays or provisions

Conclusion

The rule that public holidays don't count as annual leave is a valuable entitlement that can significantly extend your time off work. By understanding this interaction and planning your leave strategically, you can enjoy longer breaks while preserving your precious leave balance.

Remember to use our annual leave calculator to track your accrued leave, then plan your time off around Australia's public holidays to get the maximum value from your entitlements.