Christmas is a magical time in New Zealand — long sunny days, BBQs on the beach, and
well-deserved time off for many. But for business owners, it can also be a challenging period with payroll adjustments, public holiday entitlements, and cash flow management to juggle.
With the 2024/25 Christmas and New Year public holidays falling midweek, you’ll need a good plan to keep things running smoothly. Here’s a practical and friendly guide to help you get your business holiday-ready while keeping things as stress-free as possible.
Payroll for the Christmas holidays
Understanding public holiday entitlements
The Christmas and New Year public holidays — 25th and 26th December 2024, and 1st and 2nd January 2025 — fall on Wednesdays and Thursdays this year. For many Kiwi businesses, these midweek holidays will require careful planning to ensure staff are looked after and your business stays compliant with New Zealand employment laws.
Here’s the key stuff you need to know:
- Employees are entitled to a paid day off if they normally work on these days.
- If they work on a public holiday:
- They must be paid time and a half
- They are also entitled to an alternative day off for the same length of time as their usual workday (e.g., 8 hours)
Getting this right isn’t just about compliance — it’s about building trust and goodwill with your team during a time when everyone deserves a little extra care.
Encourage early leave requests
Nobody likes last-minute scheduling headaches, so encourage your team to submit their leave requests early. This helps:
- Balance staffing levels during the holidays
- Ensure leave entitlements are properly tracked and processed
A gentle reminder — perhaps a chat in your next team meeting or a friendly email can go a long way. It also gives everyone peace of mind knowing the roster is sorted well in advance.
Adjusting payroll schedules
If your usual payday falls on a public holiday, it’s standard practice to pay employees on the last working day before the holiday. For example:
- If payday is Wednesday, 25th December, your team should be paid on Tuesday, 24th December
Here’s why it’s important:
- It ensures employees have access to their pay when they need it
- It helps them plan their own holiday budgets and cash flow
Make sure to communicate any changes to pay dates early. A quick email or notice in your payroll system can avoid any confusion or last-minute panic.
Filing payroll in advance
To save yourself stress during the holiday rush, consider filing your payroll in advance. Most systems allow you to do this, and it’s a lifesaver when the office is closed, or your payroll admin is on leave. Get everything ready by:
- Reviewing leave records and hours worked
- Ensuring all necessary approvals are in place
- Double-checking your numbers to avoid errors
It’s also a good idea to let employees know their pay schedule early so they can plan their finances over the holiday season.
Managing cash flow during the holidays
Ah, cashflow — the lifeblood of any business. The holiday season can put pressure on your finances, with higher expenses and potential delays in income. But with some planning, you can stay in control and enjoy the summer break without financial stress.
Forecasting sales
Start with the basics: what’s your expected income over the holiday period? Look at:
- Historical sales data to spot seasonal trends
- Your current market conditions to adjust expectations
By understanding demand, you can make better decisions about inventory, staffing, and promotions.
Budgeting for the holidays
A solid budget is your best friend. Make sure to account for:
- Holiday pay and bonuses for staff
- Overtime or temporary hires if you need extra hands
- Marketing campaigns and holiday promotions
Don’t forget to include a buffer for unexpected costs — because you never know what might pop up.
Collecting receivables
Holiday spending can leave some customers dragging their feet on payments. Get ahead of this by:
- Sending friendly reminders for outstanding invoices
- Offering early payment discounts to encourage quicker settlements
- Following up on overdue accounts before the holiday break
A steady cash inflow before the holidays can make all the difference.
Managing payables
It’s all about balance. To keep your business running smoothly:
- Negotiate extended payment terms with suppliers where possible
- Prioritise payments to key suppliers to avoid disruptions
Remember, maintaining good relationships with your suppliers is just as important as keeping your cash flow healthy.
Inventory management
If you sell products, smart inventory management is essential. No one wants shelves overflowing with unsold stock — or worse, running out of what customers want. Use these tips:
- Base your orders on historical trends to avoid overstocking
- Implement just-in-time inventory where it makes sense
Getting the balance right will free up cash while keeping your customers happy.
Build a cash reserve
Think of this as your financial safety net. Set aside some extra cash to cover unexpected costs, slow sales, or other holiday surprises. Even a small buffer can make a big difference when things don’t go to plan.
Holiday staffing costs and marketing
Planning for extra staffing
If your business gets busier over the holidays, make sure you’ve planned for additional costs like:
- Overtime for regular staff
- Hiring temporary workers if needed
This is also a good time to review your rostering to make sure you’re neither overstaffed nor understaffed.
Making your marketing count
The holiday season is prime time for promotions, but it’s easy to overspend if you’re not careful. Focus on:
- Cost-effective campaigns that deliver a strong return on investment
- Targeting your efforts to the customers most likely to buy
Keep an eye on the results as they come in and tweak your approach if needed.
Keeping everything on track
Streamline operations
Look for ways to improve efficiency, like:
- Optimising logistics to save on shipping costs
- Reducing waste in production or day-to-day operations
A leaner operation can give your cash flow a bit of breathing room.
Monitor your finances
Even when things are running smoothly, keep a close eye on your cash flow. Regularly review:
- Income and expenses to spot any red flags
- Financial reports to ensure everything is on track
If something looks off, act quickly to adjust your strategy.
Communicate with your team and partners
Good communication is key to avoiding hiccups over the holidays. Let your staff, suppliers, and even your bank know what to expect. Whether it’s altered schedules, order timelines, or payment terms, being upfront builds trust and helps everyone plan better.
FAQs: Your Christmas payroll and cash flow questions answered
What happens if payday falls on a public holiday?
You’ll need to pay your employees on the last working day before the holiday. For example, if payday is 25th December, pay on 24th December instead.
How do I keep cash flow steady during the holidays?
- Speed up invoice collection with early payment incentives
- Build a cash reserve to cover any surprises
- Negotiate better terms with suppliers if you need extra flexibility
What are the rules for employees working on public holidays?
Employees who work on public holidays are entitled to:
- Time and a half pay
- An alternative day off equal to their usual workday
With some forward planning, clear communication, and smart financial management, you can enjoy a smoother holiday period — and maybe even take a well-deserved break yourself. Christmas in New Zealand is all about relaxing and recharging, and with these tips, your business can do just that.
Disclaimer: The information provided in this article is intended for general informational purposes only and may not apply to the specific details of your business. For personalised and tailored advice, we recommend reaching out to our professional team. While we strive to provide accurate and up-to-date content on our website, RightWay assumes no responsibility for any business loss or damage that may arise from relying on the information provided.
