Confirm the employment end date and notice position
Work out whether notice was worked, paid in lieu, waived by agreement, or lawfully absent because of summary dismissal. The answer affects the wage component.
FINAL PAY AFTER DISMISSAL
Losing the dismissal argument does not make the final-pay calculation optional — and winning it does not automatically tell you what the payroll should contain.
Final pay is a separate accounting exercise after employment ends. It can include wages through the end date, notice pay where applicable, annual-holiday payments, alternative holidays, public-holiday consequences and other contractual amounts. The correct components depend on how the employment ended and the employee's leave history.
START WITH THE REAL ISSUE
What this situation actually means.
Employment New Zealand says final pay must include final wages, all holiday pay the employee is entitled to, and other payments owing. It must be paid on or before the payday for the final pay period, which can fall after the employee's last physical day at work.
Annual-holiday termination calculations can be more complicated than simply multiplying the leave balance by an hourly rate. Employees with entitled annual holidays are generally paid those holidays at the greater of ordinary weekly pay or average weekly earnings, with an additional 8% calculation for the part-year since the last entitlement anniversary. Different rules apply before the first entitlement date.
Unused entitled annual holidays can also notionally extend beyond the last day for the purpose of public holidays. If a public holiday falls within that extension on a day the employee would otherwise have worked, further payment may be due. Unused alternative holidays are paid out; unused statutory sick or bereavement leave is not generally paid unless the agreement provides otherwise.
WHAT MATTERS
Four things to check before deciding what the case is worth.
Reconcile annual holidays
Separate annual holidays already entitled from the part-year since the latest anniversary. Check the rate used and whether gross earnings were calculated correctly.
Check alternative and public holidays
Outstanding alternative holidays should be paid. Entitled annual holidays may also create a public-holiday extension after termination in some cases.
Challenge deductions separately
A deduction from final pay needs its own lawful basis. Do not assume an employer can simply set off alleged losses, insufficient notice or property claims however it chooses.
WHAT TO DO NOW
Keep the next steps practical.
Get the final payslip and leave ledger
Ask for the gross components, deductions, annual-holiday balance, anniversary date and alternative-holiday balance.
Compare with the employment agreement
Check notice, redundancy compensation, commission, bonus, allowances and any clause dealing with deductions or leave.
Rebuild the last pay period
List hours/days worked, notice arrangements, leave and any outstanding reimbursable or contractual payments.
Raise discrepancies in writing
Identify each disputed component and the amount or information needed rather than sending a general message that the final pay is wrong.
RED FLAGS
Facts that deserve a closer look.
- CHECK
The final payslip contains only ordinary wages and ignores leave balances
- CHECK
Annual holidays are paid at a simple hourly rate without any apparent OWP/AWE comparison
- CHECK
Outstanding alternative holidays disappear
- CHECK
A large deduction is made without explanation
- CHECK
Summary dismissal is used as a reason to withhold earned wages or holiday pay
- CHECK
A contractual redundancy, commission or bonus entitlement is omitted without analysis
FAQ
Questions people ask in this situation.
When does final pay have to be paid in NZ?
Employment New Zealand says final pay must be paid on or before the payday for the final pay period. That payday may be after the employee's last day at work.
Do I still get holiday pay if I was dismissed for serious misconduct?
Yes. Summary dismissal can remove the notice period, but it does not cancel statutory annual-holiday and other final-pay entitlements already owing.
Is unused sick leave paid out when employment ends?
There is generally no statutory entitlement to cash out unused sick or bereavement leave on termination. An employment agreement can provide a more generous entitlement.
Can public holidays after my last day affect final pay?
Sometimes. Unused annual holidays to which you are already entitled are treated as if taken immediately after employment ends for this calculation, and qualifying public holidays within that extension can create additional payments.
FINAL PAY AFTER DISMISSAL
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