Have Questions About Paid Holidays By Law? Here Are Your Answers

What Are The Paid Holidays By Law?
6
min read
February 10, 2021

You want to keep your business running like a well-oiled machine, but you also need to comply with employment laws and ensure you’re treating your employees fairly.

With that in mind, you have a number of questions rattling around in your brain. What are the paid holidays by law? Do you need to pay employees extra on those days? Is it different for hourly or salaried employees? What about religious holidays?

Have no fear—these types of regulations can get complicated, and it’s totally normal to have questions. We’re answering some of the most common questions about paid holidays here, so you can make sure you comply with any laws and, more importantly, treat your employees right

What Are The Federally Recognized Holidays In The United States?

There are 10 federally-recognized holidays in the United States. According to the U.S. Office of Human Resources Management, these holidays are: 

In the Washington D.C. metro area, Inauguration Day (which happens on January 20 every four years) is also a federal holiday. If January 20 falls on a Sunday, then Inauguration Day is moved to the following Monday, January 21. 

What does it mean if a holiday is federally-recognized? Well, not quite as much as you might think. Basically, all non-essential federal government offices are closed, the stock market ceases trading, and all federal employees are paid for that day—even if they aren’t working. 

Are Employers Required To Give Employees Those Holidays Off From Work?

The answer to this question depends on whether an employer is a federal employer or a private sector employer.

Federal Employers And Federal Holidays

All non-essential government offices are closed on federal holidays, which means those federal employees are given the day off. 

However, there are still federal employees whose offices are open and need to work on those federal holidays. In those cases, most of them are given a replacement day off (often called an “in-lieu-of holiday”) to make up for that missed holiday. 

Of course, there are some exceptions, including: 

Private Sector Employers And Federal Holidays

Things are totally different for employers in the private sector. Private employers aren’t required by federal law to give employees any of the federal holidays off. However, many of them offer at least some of the federal holidays as paid time off (PTO)

As data from the Bureau of Labor Statistics highlights, Martin Luther King Jr.’s birthday, Washington’s birthday (also known as President’s Day), Columbus Day, and Veterans’ Day are less common for private sector employees to have off. Most private sector employers offer: 

What About Religious Holidays?

While employers should give “reasonable accommodations” to employees who are observing religious holidays (such as Good Friday), that’s determined on a case-by-case basis and is usually established in the employee handbook.

The rules around religious holidays also differ between federal and private sector employers: 

Are Employers Required To Provide A Certain Number Of Paid Holidays?

Yes, federal employers are required to give those 10 federal holidays off to full-time employees or offer replacement holidays to make up for them.

However, private sector employers aren’t actually legally obligated to provide any paid holidays to employees. In the eyes of the law, those federally-recognized holidays are still viewed as regular work days. 

Are Employees Entitled To Extra Pay For Working A Holiday?

So, maybe you aren’t required to give employees the day off on those federally-recognized holidays. But, if you have them work, do you need to pay them more? In most cases, no. 

Again, federal employees should have the day off and be paid for it. 

However, private sector employers do not need to provide holiday pay to employees who work on these federal holidays. This is spelled out by the Department of Labor in the Fair Labor Standards Act (FLSA), which states that employers do not need to pay employees for time that isn’t actually worked. 

While it’s not legally required, many employers do offer holiday pay (such as double time or time and a half) to their employees to reward and incentivize them for working on those days. Keep in mind that while holiday pay isn’t mandatory, standard rules about overtime pay will still apply on those days—since they’re viewed as a normal workday. 

There Are A Few Holiday Pay Exceptions…

Of course, when it comes to employment law, very few things are straightforward. This means that there are a couple of state laws that impact holiday pay that you should know about.

Paid Holidays By Law: What Employers Need To Know

Do you need to give your employees vacation time for federal holidays? Well, it depends. If you’re a federal employer, then yes, employees are entitled to these federal holidays (or replacement days) off. 

But, things aren’t so definite in the private sector. Generally, it’s up to the employer to determine how they’ll handle federal holidays, holiday pay, scheduling and more.

When you’ve sorted out how you want to treat federally-recognized holidays, it’s in your best interests to spell those rules out in your employee handbook. That will proactively clear up any confusion and ensure you and your employees are on the same page about how you’ll handle holiday time, vacation days, and any other PTO or employee benefits. 

As if paid holidays weren’t complicated enough, they can also impact your payroll. Take the headaches out of the process by automating your payroll with Hourly. Start your free trial.

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