Termination Essentials

NZPPA Certificate in Payroll Termination Essentials (Level 4)

Extending annual holiday entitlement on termination The difference between entitlement and accrual is that entitlement represents money and time, whereas accrual just represents money under the Act. What this means when an employee is terminated is that any annual holiday entitlement is extended from the termination date, and if there are any public holidays during that time, then the employee would get those as well. Please note: if the employee has only accrual, then this does not apply as accrual is 8% (only money) and does not extend from the termination date. For example: Wendy has three weeks of annual holiday entitlement that will be cashed up on her termination. Her termination will happen the week before Easter so if her annual holiday entitlement is extended; she will also get Easter Friday and Monday paid out in her final pay using the relevant daily pay calculation.

Termination Date

Extend 3 weeks from termination date

Easter holidays (Easter Friday & Easter Monday)

Please note: even though this is extended, if the employee’s anniversary date were in the extended period, they would not get their next four weeks of entitlement.

Payment for leave and holidays in final pay: • https://www.employment.govt.nz/leave-and holidays/calculating-payments-for-leave-and holidays/calculating-payment-for-leave-and holidays-in-final-pay/

© New Zealand Payroll Practitioners Association, Mar 2026, Ver 9

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