Is Holiday Pay Required by Law?

Holidays vector imageWhenever a holiday rolls around employers start thinking about how and how much to pay their employees and whether it’s mandatory to pay them at all. Many companies offer 5 to 10 paid holidays per year. This custom has left many employers unclear on whether paying employees for holidays is actually a requirement.

Employers Need Not Pay Extra For Holidays

It is a common misconception that the federal government requires businesses to pay employees extra for holidays. There is no state or federal law requiring private employers to pay employees extra for working on a holidays, nor is there any law requiring employers to give employees paid time off for holidays. Federal employees, however, do get paid holidays.

Holidays Do Not Factor In to Overtime Calculations

An employee can earn holiday pay and overtime in the same week only if the employee spends more than 40 hours doing actual “work” (in California, overtime is paid by day). Let’s say the employee puts in 36 hours during a holiday week plus he gets his 8 hours paid holiday. That holiday pay does not figure into the overtime calculation. The payroll would look like this: 40 “regular” hours and 8 “holiday” hours at the the regular rate.

Other types of non-working pay include sick, vacation, bereavement, jury duty, ect. which are treated similarly with regard to overtime. We have written about the topic before. Take a look at this post: Do Vacation Hours Count As Overtime.

If you are ready to give up the hassle of overtime and accrual calculations, let do the job for you! We would be happy to help you set up a trial account and show you how easy it can be to track holiday, vacation, and overtime.

The Federally Recognized Holidays

  • New Year’s Day
  • Birthday of Martin Luther King, Jr.
  • Washington’s Birthday
  • Memorial Day
  • Independence Day (4th of July)
  • Labor Day
  • Columbus Day
  • Veterans Day
  • Thanksgiving Day
  • Christmas Day

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