Division 3 of Part IV of the Employment Act (Chapter 373) creates the statutory holiday entitlement. Section 58 excludes casual employees and piece-rate workers, and section 47 excludes piece-rate employees from Part IV generally.
Section 61(1) — fourteen consecutive days
Subject to the provisions of any registered award, an employee is entitled, for each year of continuous service, to a period of 14 consecutive days paid leave, including non-working days occurring within that period.
And where a public holiday falls within the leave and is observed on a day that would have been an ordinary working day had the employee not been on leave, one extra ordinary working day is added for each such holiday.
The 14 days include non-working days falling within them — so a fortnight’s leave that spans two weekends is 14 days, not 14 working days. What is added is a day for each public holiday that would have been an ordinary working day.
The opening words — subject to the provisions of any registered award — mean an award may provide more. It cannot provide less, because section 11(4) voids a term less favourable than the Act.
Section 61(2) and (3) — accrual and banking
- Section 61(2) — the right to recreation leave accrues at the end of each period of 12 months’ continuous service.
- Section 61(3) — leave credits may be accrued, by agreement between employer and employee, for any period of continuous service to a maximum of four years.
An employer cannot unilaterally refuse to let leave be taken and treat it as banked, and an employee cannot bank beyond four years (that is, 56 days). Where leave has been accumulating, get the agreement recorded and check the running total against the ceiling.
Sections 59 and 60 — what counts as continuous service
“Continuous service” means continuous service with the same employer.
| Event | Continuity | Counts towards leave? |
|---|---|---|
| Transfer of contract under s 25 | Unaffected — s 60(1)(a) | Yes |
| Death of the employer | Unaffected — s 60(1)(b) | Yes |
| Sick leave | Unaffected — s 60(1)(c) | Yes |
| A break in service of not more than three months | Unaffected | No — s 60(2)(e)–(f) |
| Suspension of the contract under a law | Unaffected | No |
| Maternity leave | Unaffected | No |
| Any cause beyond the control of the employee | Unaffected | No |
The distinction in section 60 is between breaking the chain and counting towards the entitlement. The four events in section 60(2) do not break continuity — the service either side is joined up — but the period of absence itself is not taken into account in computing leave under section 61(1) or the qualifying period under section 61(4).
A worker laid off for two months and re-engaged by the same employer keeps their accumulated service for leave purposes. Only a break of more than three months breaks the chain. Keep the dates.
Section 61(4) and (5) — leave on termination
An employee whose employment terminates or is terminated is entitled to be paid recreation leave, if he has completed not less than six months’ continuous service, at the rate of one day for each completed month of service.
- It applies whether the employee resigns or is dismissed — “terminates or is terminated”.
- The threshold is six months’ continuous service.
- The rate is one day per completed month — so 20 months’ service yields 20 days, not 14 plus a part-year fraction on a different basis.
- Section 61(5) — where the contract expires or is terminated and leave is owed, the employer may pay an amount equal to the employee’s wages for the period of leave instead of granting the leave.
This is part of final pay, and it is a debt payable regardless of whether the termination was lawful.
Section 62 — how leave pay is calculated and when it is paid
(a) the employee’s ordinary rate of pay for every day of recreation leave to which he is entitled; and
(b) the total of his entitlement prior to the commencement of the recreation leave.
Paragraph (b) is a timing rule and it is frequently ignored: leave pay must be paid before the leave starts, in full — not in the normal fortnightly instalments while the employee is away. A worker travelling home for two weeks should have the whole amount in hand before leaving.
Section 63 — long service credits under the repealed Act
An employee who had accrued long service leave credits under section 127A of the repealed Native Employment Act 1958 before the commencement date, and who continued in employment with the same employer, is credited with recreation leave at the rate of three and a half days for each year of service over which those credits accrued, with pro-rata entitlements from the completion of six months of such service. Section 152 repealed that Act; sections 153 to 155 deal with the transition generally.
Checking your leave
- Fix your service start date — and remember section 22(3): the contract cannot be deemed to have started later than the day you commenced duty.
- Add up completed years — 14 days for each.
- Add a day for each public holiday falling within a leave period on what would have been a working day.
- Check breaks — three months or less does not break continuity.
- Check the four-year accrual ceiling if leave has been banked.
- On leaving, claim one day per completed month if you have six months’ service.
- Insist on payment before the leave starts under section 62(b).
- Ask for the leave record — section 138 makes refusing reasonable information an offence.
Sources
- Employment Act (Chapter 373) — ss 11, 22, 25, 47, 58–63, 66, 84, 138, 152–155; Part IV Division 3
- Industrial Relations Act — PacLII 1986 Revised Edition
- Paulus v Nestle (PNG) Ltd [2021] PGNC 342; N9186
- Mamugoba v New Britain Palm Oil Ltd [2024] PGNC 419; N11082
Before relying on anything here, read the current text of the Employment Act (Chapter 373) and check for later amendments. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.