The holidays are an exciting time to spend with loved ones, making employees more concerned about pay surrounding this time of year. Holiday pay is one of the multitudes of benefits or compensation an employer may offer.
Holiday or paid time off (PTO) benefits employees by helping them find a healthy work/life balance. Holiday pay is often used as an incentive to get employees to work during holidays or other busy seasons.
Holiday pay is a valuable incentive to gain job talent and reward employees for partnership. However, some intricacies exist in holiday pay in practice for employers and employees alike.
What Is Holiday Pay?
Holiday pay is any alternative compensation an employer provides workers while on vacation. It could come in the form of fully or partially compensated time off, a bonus or higher hourly pay for work done on holidays, or all of the above.
The most widely held belief on holiday pay in the United States is that businesses should pay workers who work on holidays "time-and-a-half," or 150 percent of their regular hourly salary.
Holiday pay can also refer to paying workers more in exchange for working on a legal holiday. Some businesses offer double time compensation, time and a half pay, or another incentive. Employers utilize this as a perk to entice workers at periods when many would often opt to take time off.
Paying employees for holidays is an investment in their well-being. Although it is not a requirement by law, many employees today expect it as a benefit of their employment. Understanding "what is holiday pay" for your company is crucial to preventing employee confusion and upholding proper payroll procedures.
Who Is Eligible For Holiday Pay?
All businesses open on state or federal holidays must strictly abide by the applicable pay legislation, but is there a legal requirement for holiday pay to be distributed to employees?
Actually, no. In particular, federal law does not require companies to give their workers extra pay for working on a holiday. The Fair Labor Standards Act (FLSA) only mandates that employers pay for hours performed and are not required to pay employees for the holidays they may not be required to work or any additional amount for a holiday.
For instance, if workers take the day off on Christmas Day, a federal holiday, they are not legally entitled to compensation. The decision to offer holiday pay sits with the employer per the U.S. Department of Labor.
Employer Holiday Pay Standards
The initial employment agreement can include a full understanding of an employer's benefits offerings. These benefits are important to consider when searching for employment as they indicate the resources available for employee care.
Although not required, payment for time not worked benefits employers. Employers should specify when employees will be excused from work holidays and if they were paid for that time in their employment contracts. Employers should also specify whether extra pay will be given to individuals who work on holidays—gaining talent benefits from transparent visibility of the rewards provided.
Holiday pay is a form of monetary bonus for employees who receive standard pay from the business, even during days off like Christmas or Thanksgiving. Holiday pay is attractive to employees as it is an additional benefit that can reward employees during the holidays to show employer care.
Exempt vs. non-exempt employees for holiday pay
Holidays are treated as regular working days under federal law, although not all companies are required to give non-exempt workers overtime compensation under federal and state legislation. Exempt workers, however, are not entitled to overtime compensation.
Employers are not required to compensate you for a day off you choose to take over a holiday (such as sick or vacation time). Employers must only pay employees for time actually worked under the Fair Labor Standards Act (FLSA).
This implies that if you decide to skip work on a federal holiday like Christmas Day or New Year's Day, your company is not obligated to pay you anything.
Holidays are often regarded as regular workdays, and you will probably earn standard compensation for the period worked if you are a non-exempt employee in retail or hospitality, where there are a lot of hourly workers.
Those who work for minimum wage or close to the minimum wage may find that employers are more willing to offer holiday pay as an incentive to keep their businesses staffed during the holiday season.
According to the Equal Employment Opportunity Commission, employers must accept requests for religious observances in a consistent and non-discriminatory manner, although they are not required to do so if doing so would be financially burdensome for the business.
How Does Holiday Pay Work?
Holiday pay, in whatever form, is typically distributed through standard payroll practices unless otherwise stated by an employer. Some employers also permit employees to take a floating holiday whenever they like. Similar to other benefits like employee discounts and health insurance, this time off is regarded as a perk for employees.
While some industries, like healthcare and hospitality industries, do not allow employees to take off for the holidays, a number of major holidays are publically recognized. Employees required to work on holidays may be rewarded with comp time (extra time off to be taken away from the holidays).
These are the most common paid holidays:
- New Year's Day
- Easter
- Memorial Day
- Independence Day (4th of July)
- Labor Day
- Thanksgiving Day
- Friday after Thanksgiving
- Christmas Day
Which holidays are paid holidays varies from employer to employer. The dates of certain holidays can also vary, so it is imperative to refer to an employer's human resource department for details on specific holidays.
Can Employers Attach Conditions to Holiday Pay?
Employers can attach conditions to an employee's reception of holiday pay. The day before and the day following a holiday, for instance, can be required to be worked or to be in a permitted leave status in order for employees to be eligible for holiday pay.
Before becoming eligible for holiday pay, an employee may also need to have worked for the company for a predetermined amount of time.
Additionally, the employer may prorate the amount of holiday compensation owed to a part-time worker. Whatever requirements must be met in order to get holiday compensation should be specified in writing, usually found in the employee handbook.
The responsibility for understanding how your employer handles holiday pay falls to employees, so give it the consideration it deserves before deciding to take a job.
Helpful Resources:
Official website - U.S Equal Employment Opportunity Commission
The holidays are an exciting time to spend with loved ones, making employees more concerned about pay surrounding this time of year. Holiday pay is one of the multitudes of benefits or compensation an employer may offer.
Holiday or paid time off (PTO) benefits employees by helping them find a healthy work/life balance. Holiday pay is often used as an incentive to get employees to work during holidays or other busy seasons.
Holiday pay is a valuable incentive to gain job talent and reward employees for partnership. However, some intricacies exist in holiday pay in practice for employers and employees alike.
What Is Holiday Pay?
Holiday pay is any alternative compensation an employer provides workers while on vacation. It could come in the form of fully or partially compensated time off, a bonus or higher hourly pay for work done on holidays, or all of the above.
The most widely held belief on holiday pay in the United States is that businesses should pay workers who work on holidays "time-and-a-half," or 150 percent of their regular hourly salary.
Holiday pay can also refer to paying workers more in exchange for working on a legal holiday. Some businesses offer double time compensation, time and a half pay, or another incentive. Employers utilize this as a perk to entice workers at periods when many would often opt to take time off.
Paying employees for holidays is an investment in their well-being. Although it is not a requirement by law, many employees today expect it as a benefit of their employment. Understanding "what is holiday pay" for your company is crucial to preventing employee confusion and upholding proper payroll procedures.
Who Is Eligible For Holiday Pay?
All businesses open on state or federal holidays must strictly abide by the applicable pay legislation, but is there a legal requirement for holiday pay to be distributed to employees?
Actually, no. In particular, federal law does not require companies to give their workers extra pay for working on a holiday. The Fair Labor Standards Act (FLSA) only mandates that employers pay for hours performed and are not required to pay employees for the holidays they may not be required to work or any additional amount for a holiday.
For instance, if workers take the day off on Christmas Day, a federal holiday, they are not legally entitled to compensation. The decision to offer holiday pay sits with the employer per the U.S. Department of Labor.
Employer Holiday Pay Standards
The initial employment agreement can include a full understanding of an employer's benefits offerings. These benefits are important to consider when searching for employment as they indicate the resources available for employee care.
Although not required, payment for time not worked benefits employers. Employers should specify when employees will be excused from work holidays and if they were paid for that time in their employment contracts. Employers should also specify whether extra pay will be given to individuals who work on holidays—gaining talent benefits from transparent visibility of the rewards provided.
Holiday pay is a form of monetary bonus for employees who receive standard pay from the business, even during days off like Christmas or Thanksgiving. Holiday pay is attractive to employees as it is an additional benefit that can reward employees during the holidays to show employer care.
Exempt vs. non-exempt employees for holiday pay
Holidays are treated as regular working days under federal law, although not all companies are required to give non-exempt workers overtime compensation under federal and state legislation. Exempt workers, however, are not entitled to overtime compensation.
Employers are not required to compensate you for a day off you choose to take over a holiday (such as sick or vacation time). Employers must only pay employees for time actually worked under the Fair Labor Standards Act (FLSA).
This implies that if you decide to skip work on a federal holiday like Christmas Day or New Year's Day, your company is not obligated to pay you anything.
Holidays are often regarded as regular workdays, and you will probably earn standard compensation for the period worked if you are a non-exempt employee in retail or hospitality, where there are a lot of hourly workers.
Those who work for minimum wage or close to the minimum wage may find that employers are more willing to offer holiday pay as an incentive to keep their businesses staffed during the holiday season.
According to the Equal Employment Opportunity Commission, employers must accept requests for religious observances in a consistent and non-discriminatory manner, although they are not required to do so if doing so would be financially burdensome for the business.
How Does Holiday Pay Work?
Holiday pay, in whatever form, is typically distributed through standard payroll practices unless otherwise stated by an employer. Some employers also permit employees to take a floating holiday whenever they like. Similar to other benefits like employee discounts and health insurance, this time off is regarded as a perk for employees.
While some industries, like healthcare and hospitality industries, do not allow employees to take off for the holidays, a number of major holidays are publically recognized. Employees required to work on holidays may be rewarded with comp time (extra time off to be taken away from the holidays).
These are the most common paid holidays:
- New Year's Day
- Easter
- Memorial Day
- Independence Day (4th of July)
- Labor Day
- Thanksgiving Day
- Friday after Thanksgiving
- Christmas Day
Which holidays are paid holidays varies from employer to employer. The dates of certain holidays can also vary, so it is imperative to refer to an employer's human resource department for details on specific holidays.
Can Employers Attach Conditions to Holiday Pay?
Employers can attach conditions to an employee's reception of holiday pay. The day before and the day following a holiday, for instance, can be required to be worked or to be in a permitted leave status in order for employees to be eligible for holiday pay.
Before becoming eligible for holiday pay, an employee may also need to have worked for the company for a predetermined amount of time.
Additionally, the employer may prorate the amount of holiday compensation owed to a part-time worker. Whatever requirements must be met in order to get holiday compensation should be specified in writing, usually found in the employee handbook.
The responsibility for understanding how your employer handles holiday pay falls to employees, so give it the consideration it deserves before deciding to take a job.
Helpful Resources:
Official website - U.S Equal Employment Opportunity Commission
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