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Holiday Pay 101: Myths and Realities About Employer Responsibilities

Posted by Giselle Solorzano on November 12, 2019

If you think that you’re required to pay your employees on holidays even if they don’t work or to pay them extra on a holiday they do work, you’re not alone. But despite this popular belief, required holiday pay is actually a myth! Holiday pay is not legally mandated in the United States, so the details of what this looks like in your practice are totally up to you.

Of course, paying your employees on holidays can boost employee morale and create a positive work environment. And paying them extra for working is a gesture of kindness and generosity to your team for giving their time on valued days that they could otherwise be spending with family or friends. In addition, it enhances your benefits package, creating a tangible competitive advantage over practices that do not offer holiday pay.

What is Holiday Pay?

All employees need to be compensated for their time worked, but some employers choose to offer holiday pay to employees even if they don’t work on a holiday. In addition, they may pay those employees who do work time-and-a-half or double-time.

Choosing to implement holiday pay – and how much – can be a complex decision, but we’ve got some suggestions for how to make it simpler.

  1. What works for you practice may be different from another, so you practice leaders may benefit from considering questions such as:

    • Do your employees work longer hours than normal on a holiday?

    • Are employees able to choose which holidays they work or are their hours see in stone regardless of the day of the year?

    • Do your employees get other time off during the holidays, such as when your entire practice is closed?

  2. Revisit your business values. If they include ideals like family, teamwork, or fun, it may be especially in alignment for your practice to reward your employees for their hard work on special days, as long as it also makes financial sense.

  3. We know that you love your employees and want to treat them oh so well, but we also know that the decision of whether or not to offer holiday pay should be rooted in financial best practices. Paying everyone on the holidays can get pricey, so be sure to prioritize your actual required expenses when planning out your payroll expenses before choosing this added benefit.

How Does Holiday Pay Work for Salaried Employees?

You get to decide! Some practices set different policies for exempt, non-exempt, and hourly employees, while others choose to compensate similarly for everyone. Just make sure these policies are clear to your team.

Informing Your Employees about Holiday Pay Policies

Regardless of what you decide about implementing a holiday pay policy, it is best practice to be up front with your new hires as well as current employees about how you handle this benefit. This information can go into your employee handbook with the rest of your payment policies. Remember that if you choose to offer it, holiday pay can be a perk for your benefits package and a value add for the culture of your company. But if you decide it isn’t right for your practice, know that you are still operating within the legal guidelines and holiday pay laws to pay employees their regular wages on holidays and only pay for time worked!


If you have additional questions about holiday pay or any other HR-related issues, we can help. please reach out to us  via one of the following methods: SCHEDULE A CALL, or call: 877.779.4747, or email: today!


HR for Health is one of the nation’s leading Human Resources Management Systems (HRMS) used by small to mid-sized practices.


Quick note: This is not to be taken as legal or HR advice. Since employment laws change over time and can vary by location and industry, consult a lawyer or HR expert for specific guidance. Learn about HR for Health's HR services

Topics: Wages, holiday pay, holidays