The holidays are right around the corner and you may be wondering whether your company is required to provide time off or holiday pay. Here's a look at some of our most frequently asked questions and answers.


Am I required to provide my employees time off for a holiday?

Although not generally required by federal or state law, many employers choose to grant employees time off for certain holidays or to close the business altogether on those days.


Companies with 15 or more employees are subject to federal religious discrimination laws and may need to allow employees time off for religious observance, unless such time off would be an undue hardship for the business. You should also consult your state's nondiscrimination laws to learn if there are similar requirements for time off related to religious observances for employers of fewer than 15 employees.


What are some common holidays that employers observe?

Common holidays observed in the U.S. include:

  • New Year's Dayholiday time off
  • Martin Luther King, Jr. Day
  • Presidents' Day
  • Memorial Day
  • Independence Day (Fourth of July)
  • Labor Day
  • Columbus Day
  • Veterans' Day
  • Thanksgiving Day and the Day After Thanksgiving
  • Christmas Day


Do I have to pay my employees if my business is closed for a holiday?

Federal law and most state laws do not require employers to pay employees if time off for holidays is granted. Whether or not employees are paid for holidays is generally a matter of company policy. Be careful when it comes to exempt employees, though—as a general rule, if an exempt employee performs any work during a workweek, he or she must be paid the full salary amount.


What about employees scheduled to work on a holiday if my business remains open?

Compensation for work on holidays is also generally a matter of company policy, although you must comply with any specific state law requirements regarding holiday pay. Although some companies pay employees at a special rate (such as time-and-a-half) for holiday shifts, generally an employee is only entitled to his or her regular pay, plus any overtime.


Some companies have policies providing "compensatory holidays" in the event a paid holiday is missed through no fault of the employee, like where an employee works on the holiday—in such case, the comp holiday would be used on a day that is mutually convenient for the employee and the company. Other companies provide that paid holidays are lost if the employee would not have been at work in any event (a holiday that falls in a vacation week or a period of a leave of absence), or if the employee worked on that day.


Remember that states will generally enforce an employer's written policy regarding holiday pay, so it's important to follow your own policy and to apply the rules consistently and fairly to all employees.


For questions about the specific requirements in your state, contact your state labor department or a knowledgeable employment law attorney. You can also visit our section on Leave and Time Off for more information on both mandatory and voluntary leave.


Learn more about the federal employment laws that may apply to your company by downloading our FREE Federal Labor Laws by Company Size chart today!


Image Credit: *clairity*

Topics: Employee Benefits, Human Resources

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