Holidays are great and fun times. We get to let slow down and relax, spend time with family or travel to bucket-list destinations. But for employers, the holidays come with a lot of uncertainty regarding holiday pay for salaried employees. It may not seem like it but there are a lot of gray areas and confusion surrounding the topic.

For instance, are you obligated to pay overtime for employees who report to work on a holiday? Do you even have to pay your employees during holidays and they are not at work? In this piece, we answer questions on holiday pay rights to help make things more black and white.

Are employers obligated to offer holiday pay for employees on holidays recognized by the federal government?

No, they are not obligated to. With a couple of exceptions, you can choose to offer holiday pay or not. Moreover, you reserve the right to determine if you remain open or close during the said holidays.

If you choose to remain open, you should treat the holiday like a normal workday. However, some states have restrictions for working on holidays.

If an employee works on a holiday, should they get premium pay?

This is not a must. Employees aren’t legally entitled to additional compensation during holidays. However, you can hold discussions to agree on additional compensation if any.

However, while the law doesn’t require you to pay a premium on holidays, most employers offer it to help boost employee morale.

Can employers deny holiday pay if employees miss working the days before and after their holiday?

If a non-exempt employee doesn’t report to work a day before or after the holiday, you can deny them holiday pay. However, you cannot enforce the same rule on salaried non-exempt and salaried exempt employees. The federal law is against such deductions. This means that the employee must receive their full payment for their holiday.

If the payday is on a holiday, should I deliver the check before or after the holiday?

It depends on state laws. In some states, you should send the paychecks within a specified time usually 15 days after the working period. And in other states, you’ll have to provide the check early if the payday is a holiday.

Can our company policy deny employees holiday pay before 90-days of employment elapse?

You can do this for the non-exempt employees. However, for salaried employees, you cannot deduct their pay for a holiday if they reported to work in that week. On the contrary, you should make full payments for every week even if they do not pass the holiday pay eligibility rule yet.

What happens if a holiday falls on a day when the business is closed or when an employee is off work?

There is no law for this. However, most employers give employees the option of taking another day off when this happens. Also, employers offer holidays on Monday or Friday if the holiday falls on the weekend. To top it all off, they remain closed over the weekend.

You should understand holiday pay guidelines and communicate your policy on the same to your employees. Moreover, you should enforce the policy consistently across the board.