Christmas Day Trading Rules: What Business Owners Need to Plan for
As the Christmas period approaches, many New Zealand businesses are reviewing whether they can trade on Christmas Day — and what that means for staffing, pay, and compliance.
Although often viewed as out of step with today’s retail and service environment, these rules continue to carry important compliance implications for employers.
Whether you’re planning to open, close, or operate with a skeleton staff, understanding the rules early helps avoid last-minute issues, payroll errors, or employee disputes during an already busy time of year.
Can Your Business Trade on Christmas Day?
Under the Shop Trading Hours Act 1990, most retail businesses must close on Christmas Day. This restriction also applies to Good Friday, Easter Sunday, and until 1pm on ANZAC Day.
That said, the law allows specific types of businesses to operate on Christmas Day, including:
Dairies and convenience stores
Petrol stations
Pharmacies
Cafés and restaurants
Hairdressers and barbers
Industry groups have long argued that Christmas Day trading restrictions no longer reflect modern consumer behaviour — particularly when online retail continues to operate without interruption.
While that debate continues, the current law remains in place. From a business perspective, the key issue isn’t whether the rules feel outdated — it’s ensuring you plan within the framework that exists today.
Getting this wrong can lead to:
Inadvertent breaches of employment law
Back-pay liabilities
Unnecessary operational risk
Staffing on Christmas Day
Even where trading is permitted, employers need to be clear about when employees can and can’t be required to work.
An employee can only be required to work on Christmas Day if:
Their employment agreement states they may be required to work on public holidays, and
Christmas Day falls on a day they would normally work.
If either of those conditions isn’t met, working on Christmas Day must be by agreement.
Pay and Leave Entitlements
If an employee works on Christmas Day, they are entitled to:
At least time and a half for hours worked, and
An alternative paid day off if the public holiday falls on a normal working day.
If they don’t work, but Christmas Day falls on a day they would usually work, they must still be paid their normal daily pay.
Casual employment arrangements can involve additional variables, particularly around work patterns, public holiday eligibility, and alternative holiday entitlements. Contact Knowhow for tailored advice to ensure obligations are met.
Practical Tips
To avoid issues during the Christmas period:
Check your eligibility to trade before committing to opening hours
Review employment agreements to confirm public holiday clauses are clear and up to date
Communicate early with staff about expectations, pay, and leave
Ensure payroll systems correctly handle public holiday rates and alternative holidays
A small amount of planning now can prevent disputes or compliance headaches later.
If you’d like support reviewing employment agreements, holiday rostering, or Christmas shutdown planning, Knowhow can help.