What is owed when employment ends is spread across Part V of the Employment Act (Chapter 373), with additional obligations for attested contracts in section 84. This is the checklist.
The components of final pay
| Component | Source |
|---|---|
| Wages to the last day worked | Part V; s 79 for the commencement rule |
| Accrued recreation leave, or money instead of it | Part IV Division 3 |
| Deferred wages held by the employer | ss 85, 90(1) |
| Refund of repatriation deductions | s 90(2) |
| Public holiday pay where employment ends the day before one | s 86(3) |
| Outstanding overtime, stand-by, call-out | ss 52–55 |
| Payment instead of notice, if the employer shortens notice | s 35(2) |
| Any repatriation entitlement | Part III Division 7 |
Deferred wages — sections 85 and 90(1)
An employer shall, when requested by an employee to do so, with the approval of a labour officer, pay to that employee all or any part of the deferred wages held by the employer on his behalf.
Deferred wages are a lawful deduction under section 88(1)(e), but only for an employee under an attested contract, and only with the employee’s written consent witnessed by a labour officer (s 88(2)). They remain the employee’s money.
Any payment of deferred wages made otherwise than in accordance with this Part is not a valid discharge to the employer for those wages.
An employer that pays deferred wages informally — in cash at the gate, to a relative, or into someone else’s account — has not discharged the debt and can be required to pay again.
Section 90(2) — refunding repatriation deductions
The employer shall refund the whole of those deductions immediately after the earlier of:
(a) the expiration of the contract, or two years from the date of engagement; or
(b) the date of termination under section 35 or 36.
Exception: where the contract is terminated under section 36(1) (employer’s summary grounds), the employer may use so much of the deductions as is necessary to repatriate the employee and dependants, and shall refund the balance.
Two points follow. The two-year backstop means a long engagement cannot hold the money indefinitely. And the exception is confined to section 36(1): on any other ending — expiry, mutual agreement, notice, or the employee’s own section 36(2) termination — the whole deduction must come back.
Section 84 — final payment under an attested contract
(a) as soon as practicable, present to a labour officer at a Labour Office at a place mutually acceptable to employer and employee: (i) the original contract; and (ii) a statement in the prescribed form showing all particulars of current and deferred wages due, and of all leave or money instead of leave received; and
(b) pay to the employee in the presence of a labour officer at that Labour Office all current and deferred wages and any other amounts due.
- Section 84(2) — where the employee is absent and cannot be located, or does not present himself for payment, the employer shall pay all amounts due to a labour officer.
- Section 84(3) — where the employee dies before payment, the employer shall pay the amounts to a labour officer for distribution according to law. See death of an employee.
Section 37 makes compliance with section 84 a condition of lawful termination of an attested contract, alongside Division 7 (repatriation) and any prescribed requirements.
Section 86(3) — finishing the day before a public holiday
Where an employer terminates the employment of an employee (other than a casual or piece-rate employee) on a day immediately preceding a public holiday, the employer shall pay the employee the wages he would have received if he had worked on that public holiday and it had not been a public holiday.
Note the counting rule in section 74: in determining the day immediately preceding a public holiday, a Saturday, Sunday or public holiday immediately preceding that public holiday is not taken into account. So a termination on the Thursday before Good Friday, or on the Friday before an Easter Monday holiday, can attract section 86(3).
What the employer may take out
- Section 87(4) — where an advance of wages has not been recovered by the end of the contract, the employer may recover the whole outstanding amount from wages payable. During employment the cap is 25% of net wages per pay period (s 87(3)).
- Section 88 — the ordinary deduction rules still apply, including the requirement of prior written consent and the 50% overall cap.
- Section 38(1)(a)(ii) — deferred wages may be retained on an attested contract only where a court so authorises.
Fines of any kind (s 94, fine up to K500). Discount, interest or similar charges for an advance, or as a reward for providing or retaining employment (s 91). And any deduction not authorised by Part V is an offence under section 96(c).
If final pay is not made
- Demand it in writing, itemised, and keep proof of delivery. Section 96(b) makes failure to pay on demand without reasonable excuse an offence.
- Ask for the section 84 statement if you were on an attested contract, and attend the Labour Office for payment.
- Report it to a labour officer; ask about proceedings under section 145.
- Remember section 93 — wages up to four months have priority over all other debts of the employer, which matters if the business is failing.
- Sue for the debt. Section 93(2) preserves recovery of any balance by ordinary process of law, and section 149 relaxes the rules of evidence in a claim under the Act.
Sources
- Employment Act (Chapter 373) — ss 35, 37, 38, 52–55, 74, 79, 84–96, 145, 149; Part IV Division 3; Part III Division 7
- Bar v Kora [2008] PGNC 17; N3290
- 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.