How Does Holiday Pay Work? (With Examples)

By Sky Ariella - Nov. 12, 2020
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The holidays are a time to eat homemade dinners, spend time with loved ones, and appreciate the good things in life. For some professionals, though, the office stays open through the holidays, and they’re expected to be there.

If this is the case for your job, you could be wondering whether you’ll be compensated extra or receive holiday pay for working on days that most people are celebrating. Companies have different policies regarding holiday pay, and there are varying ways in which you may receive it.

What Constitutes a Holiday and What is Holiday Pay?

What constitutes a holiday may differ depending on what kind of position you have, the career field you’re working in, and contract details.

In the United States, federally recognized holidays are:

  • New Year’s Day

  • Christmas Day

  • Birthday of Martin Luther King Jr.

  • President’s Day

  • Memorial Day

  • Labor Day

  • Independence Day

  • Veteran’s Day

  • Columbus Day

  • Thanksgiving Day

Government jobs offer their employees federally recognized holidays off work while still being paid as part of the benefits package. Other organizations may provide the same, more, or less. Sometimes, companies will even issue a set number of floating holidays for their employees to use whenever they see fit.

For businesses that remain open during holidays, such as hospitality, holiday pay can also be issued as extra compensation for working during a time that most would be at home. How much more you end up getting, if any, depends on the agreement you and your employer have arranged at the time of hire. Holiday pay can also differ between employees of the same company based on how much they work and their position.

According to the Fair Labor Standards Act (FLSA), companies are not required to pay their employees for time that they do not work, such as paid time off for holidays, unless a collective bargaining agent like a union represents them. You should also check with your local state laws because they could have varying requirements for your employer regarding holiday pay.

Should You Work on a Holiday?

Employees who work on holidays usually volunteer their time to do so because it can entail some great benefits, depending on your company’s holiday pay policy. It can also reflect positively on you as an employee. Others choose not to work on holidays for the obvious cons.

If your job offers holiday pay, you could be wondering if you should offer up your services to work. Consider the following positives and negatives of working on a holiday.

  • Positives of working on a holiday

    1. Extra pay. The deciding factor in working on a holiday for many employees is receiving additional compensation. Generally, companies pay this out at one and a half times what they’d usually make. However, holiday pay can also be a set bonus rate or even double your typical wage. There’s a lot of room for variation.

      This extra money can be extremely valuable to many employees, especially around holiday time, when most people’s wallets are getting thin.

    2. Your employer knows they can count on you. If you’re looking to make an impression on your boss that you’re a dependable employee, working on a holiday can be a great way to do so. It shows a commitment to putting your work life as your first priority. That can bode well for you later when your boss is considering giving you more responsibility.

    3. More vacation days. Your employer may be open to giving you extra vacation days for working on a federal holiday. This can be useful to people who don’t need those exact days off but still want the time to use it when they’d like.

      It can also be helpful to work on certain holidays that are less important to you, like Columbus Day, to have more time for when you really need it, like Christmas and New Years Day.

    4. Showcases leadership skills. While working on a holiday might not be your favorite activity, it displays the ability to act with leadership skills. When employers consider their staff for promotions to a leadership role, they consider things like who was willing to take the initiative to do things others didn’t necessarily want to, such as working on a major holiday.

      As a supervisor, there will probably be more than one occasion where you have to do tasks you’re less than thrilled about. Showing that you’re willing to put in the hard work early on in your career could propel you into management later.

    5. Satisfaction. Working on a holiday can be beneficial for more than just extra money or your working relationships. It can also be personally satisfying to know that your company needs you during a busy and stressful time for many businesses. Being an employee who pulls through and helps customers even during the holidays’ chaos can make you feel good about yourself.

    6. Sets you up for better benefits in the future. If you’re early in your career journey, volunteering to work on holidays can set you up for future growth. Businesses hire entry-level employees across multiple industries based on their potential and then expected to follow through with outstanding work. Deciding to work on a holiday can set you up for seeing better benefits a year or two down the road when your employer has seen the extent of your dedication.

  • Negatives of working on a holiday

    1. Less time with your family. For some people, giving up quality time with family around the holidays isn’t worth any amount of extra money. After all, money can be made, but time cannot. You may find that even with additional compensation, working on a holiday isn’t worth the cost of losing time with loved ones.

    2. It’s a busy time. For many organizations that stay open during the holidays, it’s their busiest time of year – think retail stores during Thanksgiving and restaurants during the fourth of July. If you choose to work during these times, you’re likely in for some hectic shifts, which could get overwhelming pretty quickly.

    3. You can’t celebrate. Even with office decorations and Christmas cookies, you can’t celebrate a holiday to its full potential when you’re working. You may be able to celebrate at a different time or keep up the holiday spirit, but it won’t be quite the same. This can be a big negative to working on a holiday for a lot of employees.

    4. More stress. The holidays are stressful times as it is. People are often dealing with family pressure, budgeting, and the general difficulty of the season. Choosing to work during major holidays on top of that will likely add even more stress.

      While many employees are experts at handling stress well, others may find that it’s too much to deal with at an already hectic time of year.

    5. Sets the expectation of you working more holidays. Once an employer knows that you’re willing to come in and work on a holiday, it could set the precedent that you’re willing to work on most holidays. This precedent can be a significant downside for many employees who want to work on smaller holidays but take off for bigger ones.

      If you’re worried about this happening, you can discuss the details of your intentions in taking on holiday work with your supervisor. Make it clear when you’re willing to work, and when you aren’t.

    6. More possibility of conflict. In addition to you being stressed, the customers and clients you’re serving will probably be equally as on edge. The holidays are a challenging time for everyone. This could contribute to an atmosphere that will likely have some conflict.

      If conflict resolution is one of your strong suits, working during holidays may be an excellent opportunity to show off these skills. However, if you don’t like dealing with stressed-out customers, you may want to avoid volunteering your services during the holidays.

What Happens When the Holiday Is on a Weekend

How an employer will handle a holiday landing on a weekend is up to them.

When a federal holiday falls on a weekend or during your time off, many employees will adopt the attitude of ‘you win some, you lose some.’ Meaning that some year’s holidays fall during the weekend and others don’t. You take what you can get.

Some employers will recognize the holiday on the Friday before or the Monday after if a holiday lands on a weekend. Companies will usually discuss this with you during the on-boarding process.

How Much Do You Get Paid for Working on a Holiday?

How companies handle holiday pay within their organization is up to their discretion, making it difficult to assess how much an employee, on average, gets paid for working on a holiday.

If you offer to work on a holiday, your employer may appreciate the effort but continue to pay you what you’d make usually.

You could potentially be paid time and a half or double your usual salary for working hours during a holiday. Some employers may also set a standard holiday bonus for employees choosing to work during that time. It’s also possible that holiday pay and benefits are only extended to some employees. For example, part-time and contract employees will often not receive the same benefits as full-time.

Since there are no federal requirements about an employer giving their staff holiday pay, it’s a decision that your company makes. During the interview and onboarding process, you can ask what their holiday pay package entails and if that offer is flexible.

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Sky Ariella

Sky Ariella is a professional freelance writer, originally from New York. She has been featured on websites and online magazines covering topics in career, travel, and lifestyle. She received her BA in psychology from Hunter College.

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