Q: I have a question around the calculation of ADP when an employee takes BEDVAPS leave after an extended period of Leave without Pay.
Example:
Employee was on agreement LWOP of 11 weeks. We factored in 10 weeks as weeks absent, essentially reducing divisor from 52 to 42 weeks. This was an agreed term.
Employee’s standard roster is 8hrs per day, Monday to Friday.
Gross earnings in the last 42-weeks = $74, 233.79
Hours worked in the last 42-weeks = 1, 632.00
Can you kindly confirm how we calculate ADP (if we cannot determine RDP) for this employee?
We have conflicting viewpoints in the team, so hoping you can provide some clarity please?
A: The divisor for ADP is days (whole or part days) not weeks was this done?
Q: The second point is more in line with section 9A: Are we to assume the 52-weeks earnings (estimated to be $91, 908.50) and divide by 204 days
9AAverage daily pay
(1)
An employer may use an employee’s average daily pay for the purposes of calculating payment for a public holiday, an alternative holiday, sick leave, bereavement leave, or family violence leave if—
(a)
it is not possible or practicable to determine an employee’s relevant daily pay under section 9(1); or
(b)
the employee’s daily pay varies within the pay period when the holiday or leave falls.
(2)
The employee’s average daily pay must be calculated in accordance with the following formula:
a
b
where—
a
is the employee’s gross earnings for the 52 calendar weeks before the end of the pay period immediately before the calculation is made
b
is the number of whole or part days during which the employee earned those gross earnings, including any day on which the employee was on a paid holiday or paid leave; but excluding any other day on which the employee did not actually work.
A: In this instance, the employee only earned $74, 233.79 in the immediate 52-week period prior, because part of that period was for time not worked. They were on an agreed sabbatical during this period. Apologies if my original query was not clear on this.
Should the calculation therefore not be more aligned with the first point?
Point 1: Based on Actual Earnings
A = earnings in last 52-weeks ($74, 233.79)
B = number of days worked (204)
74, 233.79 / 204 = $363.89
By assuming the 52-weeks, it is elevating the leave rate massively, which I don’t believe to be correct.
Point 2: Based on 52-Week Assumption
A = estimated 52-weeks earnings ($91, 908.50)
B = number of days worked (204)
91, 908.50 / 204 = $450.53
Q: Based on what you have stated this would be the correct version for ADP:
Point 1: Based on Actual Earnings
A = earnings in last 52-weeks ($74, 233.79)
B = number of days worked (204)
74, 233.79 / 204 = $363.89