This was originally posted on July 5, 2011. Many people screw up paying correctly for a holiday. Even people with the title of HR Manager had to ask how they should do this. For that reason, I publish this every year that the 4th appears on a weekday. The Fourth of July is Wednesday of this week.
Private Sector rules
It is the (week) of the holiday. So I thought I would answer a question I often get asked regarding if employees have to be paid for a holiday. The answer is, as often occurs in HR, “it depends.” Here is what it depends on:
- In the private sector under the Fair Labor Standards Act if the employee is classified as non-exempt there is no requirement to pay them for holiday hours that are spent not working. If you do pay them for the holiday it is at the company’s discretion and a matter of company policy and past practice.
- Under Federal law, this does not have to be paid at double time.
- If the holiday is paid by the company it DOES NOT have to be counted as time worked in the calculation of overtime unless the employee works that day, and by doing so ends up working more than 40 hours in the week.
- In the private sector if the employee is an exempt employee the employee must be paid their entire salary for the week regardless if they work the holiday or not. If they do not work on the holiday they cannot have their pay docked.
- Union contracts or status as a state employee will alter these requirements.
So there that is the quick and dirty on what you need to do on holiday pay for the 4th of July. And yes it does apply to other holidays as well.