What is Average Daily Pay?
Average Daily Pay, commonly shortened to ADP, is the daily average of an employee’s gross earnings across the relevant review period. It is used only in specified circumstances.
New Zealand holiday and leave pay
Average Daily Pay calculator NZ
Calculate Average Daily Pay from Holidays Act gross earnings and whole or part days, compare it with Relevant Daily Pay, and understand the limited situations in which ADP may be used.
Last reviewed: 25 August 2026
Calculated Average Daily Pay
$227.00
per applicable day, before tax and other payroll deductions
Gross earnings
$47,216.00
Whole or part days
208
Payment for 1 day
$227.00
Review period
52 weeks
ADP formula
$47,216.00 ÷ 208 days
= $227.00 average daily pay
A calculated amount does not establish that ADP is the permitted method. Check RDP first and confirm the applicable Holidays Act treatment.
Payroll calculation warning: The arithmetic is simple, but selecting the lawful payment method and identifying gross earnings and qualifying days requires accurate employment records and Holidays Act assessment.
Average Daily Pay formula
Divide gross earnings from the previous 52 calendar weeks by the number of whole or part days during which the employee earned those gross earnings.
Employees with less than 52 weeks
When employment is shorter than 52 weeks, use the weeks the employee has been employed and the corresponding gross earnings and qualifying days.
Whole or part days—not hours
The denominator counts qualifying whole or part days on which gross earnings were earned. Employment New Zealand’s example says this includes applicable paid holidays or leave.
RDP vs ADP in New Zealand
Relevant Daily Pay (RDP) is what the employee would have earned had they worked on the day. Employment New Zealand explains that it can include normal pay plus applicable incentive payments, overtime, the cash value of board or lodgings and other regular allowances, excluding non-taxable reimbursements.
Average Daily Pay (ADP) is a historical daily average. Official guidance says ADP can be used if determining RDP is not possible or practicable, or if the employee’s daily pay varies within the pay period in question. A payroll system should not choose whichever result is cheaper or easier without satisfying the applicable condition.
ADP calculation formula NZ
Average Daily Pay = gross earnings ÷ whole or part days during which gross earnings were earned
Use the 52 calendar weeks immediately before the end of the pay period before the calculation date, or the shorter employment period where applicable. Confirm the exact statutory period and payroll records for the employee.
Average Daily Pay worked example
Employment New Zealand provides an example with $47,216 of gross earnings and 208 whole or part days, including paid holidays or leave. The ADP calculation is $47,216 ÷ 208, which equals $227 per day.
When Average Daily Pay may apply
Public holidays
RDP or ADP may be relevant to payment for an otherwise working public holiday and to the base calculation when an employee works that holiday.
Alternative holidays
An applicable alternative holiday is paid using RDP or ADP under the relevant Holidays Act rules.
Sick and bereavement leave
Applicable sick and bereavement leave payments use RDP or ADP, subject to entitlement and otherwise-working-day requirements.
Family violence leave
Applicable family violence leave payments also use RDP or ADP under the relevant rules.
Do not confuse ADP with annual-holiday pay. Annual holidays use ordinary weekly pay and average weekly earnings calculations rather than this daily average formula.
What should be included in ADP gross earnings?
Use the Holidays Act gross-earnings total supported by payroll records. Do not assume that every amount paid through payroll belongs in the total or that taxable income and Holidays Act gross earnings are always identical. Check salary and wages, applicable allowances, overtime, commissions, incentive payments and paid leave against the statutory definition and official guidance.
Payroll records needed for an ADP calculation
Keep the calculation date, review-period boundaries, included earnings, excluded payments, qualifying whole or part days, the reason ADP was used and the resulting payment. Irregular rosters and part-days need particular care because a qualifying part-day is not converted into a fraction merely from hours.
Official ADP and Holidays Act guidance
Check the current legislation and Employment New Zealand guidance before completing payroll or resolving a leave-pay question.
Average Daily Pay FAQs
What is Average Daily Pay in New Zealand?
Average Daily Pay, or ADP, is a daily average calculated from an employee’s gross earnings over the relevant period divided by the whole or part days during which the employee earned those gross earnings.
What is the ADP formula?
ADP equals gross earnings for the previous 52 calendar weeks, or the employee’s shorter employment period, divided by the number of whole or part days during which the employee earned gross earnings.
When can Average Daily Pay be used instead of RDP?
Employment New Zealand says ADP can be used when it is not possible or practicable to determine Relevant Daily Pay, or when the employee’s daily pay varies within the pay period in question.
What days belong in the ADP denominator?
Use whole or part days during which the employee earned gross earnings. Employment New Zealand’s example states that this includes applicable paid holidays or leave, so it is not necessarily the same as days physically worked.
What if the employee has worked for less than 52 weeks?
Use the weeks the employee has been employed when that period is shorter than 52 weeks, together with gross earnings and qualifying whole or part days from that employment period.
Is ADP used to calculate annual holiday pay?
ADP is used for applicable daily leave and holiday payments. Annual-holiday pay uses different calculations involving ordinary weekly pay and average weekly earnings.
Can this calculator confirm payroll compliance?
No. Payroll records, included gross earnings, the correct day count, otherwise-working-day decisions and whether ADP may lawfully be used all require employer-specific assessment.