Did you know there are 11 federally recognized holidays? As an employer, you want to keep your employees happy and motivated, especially during the holiday season.
One way to do this is by offering paid holidays as a perk of their job. But are you required to give holiday pay during federally-recognized holidays?
The answer may not be as straightforward as you think. In this article, we’ll explore the holiday pay laws, including the Fair Labor Standards Act (FLSA). We will help you understand your obligations as an employer when it comes to offering holiday pay.
The Fair Labor Standards Act (FLSA)
The Fair Labor Standards Act (FLSA) is a federal law in the United States that establishes basic labor standards for employees. It sets the minimum wage, overtime pay, recordkeeping, and child labor standards.
The FLSA was signed into law in 1938 by President Franklin D. Roosevelt and has been amended several times since then. The purpose of the FLSA is to ensure that employees are fairly compensated for their work and are not exploited by their employers.
It applies to most employees who work in the private sector, as well as in federal, state, and local governments. However, some workers, such as independent contractors and some agricultural workers, are not covered by the FLSA.
Holiday Pay Laws
Holiday pay law refers to the rules and regulations surrounding the payment of wages during federally-recognized holidays in the United States. The Fair Labor Standards Act (FLSA) does not require employers to give paid holidays to their employees.
If an employer chooses to offer holiday pay, there are some guidelines that must be followed. For example, if an employee is non-exempt, the employer must factor in the paid holiday when calculating overtime pay for that week (if the holiday pay is premium pay for hours worked – holiday pay for time off would not be considered in the overtime pay calculation).
Employers can choose which holidays they want to offer and the amount of holiday pay they will give. Employers may also choose to offer PTO instead of paid holidays.
Federally-Recognized Holidays
There are eleven federally-recognized holidays in the United States, and they are:
- New Year’s Day
- Martin Luther King Jr. Day
- Presidents’ Day
- Memorial Day
- Juneteenth
- Independence Day
- Labor Day
- Columbus Day
- Veterans Day
- Thanksgiving Day
- Christmas Day
If an employer chooses to offer paid holidays, they are not required to offer all eleven of these holidays. They can choose which holidays they want to offer, and the amount of holiday pay they will give.
PTO vs. Paid Holidays
Some employers choose to offer PTO, which includes vacation time, sick time, and personal days, instead of paid holidays. If an employer offers PTO, they are not required to offer paid holidays (although some may choose to offer both!). However, if an employee uses their PTO on a federally-recognized holiday, the employer must count that day as a PTO day, not a paid holiday.
Making Sense of Holiday Pay Laws and FLSA Guidelines
The Fair Labor Standards Act (FLSA) does not require employers to offer paid holidays. It is still a valuable perk to offer your employees during the holiday season. It shows your employees that you value their time and hard work.
If you choose to offer holiday pay, make sure to follow the guidelines set forth by the FLSA. Factor in paid holidays when calculating overtime pay for non-exempt employees. If you need aid with payroll solutions, contact Valor Payroll Solutions. We will help you navigate the complexities of holiday pay and other payroll-related issues.
