Holidays For Hourly Paid Employees
Do hourly employees get paid holidays?
Every year, as the holiday season approaches, both employees ask the same question: “do we, as hourly employees, get paid holidays?”
For many salaried employees or full time employees, paid holidays are a standard part of the benefits package. But for hourly employees—those who are paid only for the hours worked—holiday entitlement often depends on local labor laws, state laws, company policy, or collective bargaining agreements.
This article explains what holiday pay means, how paid holidays work in different countries, what to expect if a holiday falls on a non-workday, and why offering holiday pay can be good business practice. We’ll also explore floating holidays, religious holidays, and how employers can accommodate employees fairly while maintaining consistency and employee morale.
What is holiday pay?
Holiday pay refers to either paid time off for officially recognized holidays—days that the company, state, or nation observes as non-working, or planned leave by an individual employee for a holiday. In many countries, when a holiday falls on a weekend, employers may move the day off to the preceding Friday or the following Monday.
For hourly employees holiday pay is uncommon, but it can take similar forms to salaried employees, such as:
- A paid day off (where the worker is paid their normal rate of pay)
- Premium pay such as time and a half or double pay if the employee works on the holiday
- Unpaid leave or unpaid time off, if the employer doesn’t offer holiday pay
Some companies provide holiday pay as part of their holiday pay policy to attract eligible employees and show appreciation for staff who regularly track hours and meet performance expectations.
So, do hourly employees get paid holidays?
In countries like the US, Australia, Canada, and the UK, state laws or provincial employment standards often require employers to give paid holidays or paid holiday time to salaried employees, but hourly employees often fall outside these conditions.
For example:
- In the United States, federal law under the Fair Labor Standards Act does not require employers to provide holiday pay or guarantee paid holidays for employees of any kind, including hourly employees. Instead, private employers choose whether to offer holiday pay, provide holiday pay, or give unpaid time off when a holiday falls on a workday. Many do so voluntarily to attract eligible employees and remain competitive.
- In Australia, state employees and private employers must provide paid holidays to full-time or part-time employees on national days such as Christmas Day, Good Friday, and Labor Day. Casual hourly employees are not entitled to any form of paid leave.
- In Canada, most provinces require employers to pay full-time and part-time employees for statutory specific holidays like New Year’s Day or Independence Day (for U.S. readers, this is analogous to Canada Day). However, casual hourly employees are not entitled to paid leave unless they work the days immediately before and after the public holiday.
- In the UK, full time employees and part time employees are entitled to paid holiday time that covers certain holidays, with pay based on average hours worked. Casual workers usually have the right to holiday pay (pro-rata, according to hours worked). However, they are usually not entitled to sick pay, maternity, or paternity leave unless this is included in your casual worker agreement.
However, in some countries without national requirements, private sector employers can decide whether or not to offer holiday pay. In those cases, many employers use it as an incentive to retain good staff and reward loyalty.
Floating holidays and flexibility
Not all workers celebrate the same religious holidays or cultural events. To accommodate employees, many companies include one or more floating holidays in their holiday pay policy.
A floating holiday is a flexible paid day that employees can use for a religious holiday, family event, or personal need. It’s also a practical form of reasonable accommodation—meeting an employee’s needs without causing undue hardship for the employer.
For example, someone might take a floating holiday for Good Friday, Election Day, or another religious holiday not recognized nationally.
Common holiday pay practices worldwide
Although rules vary, several common holiday pay practices appear globally:
- Standard paid holidays: Eligible employees receive a paid day off for national recognized holidays such as Christmas Day, Labor Day, or New Year’s Eve.
- Premium pay for working: Employees who work on certain holidays receive time and a half or double pay.
- Substitute days off: If a holiday falls on a weekend, the day off moves to the preceding Friday or following Monday.
- Floating holidays: Employees choose holiday time to match personal or religious holidays.
- Unpaid leave: Employers who don’t offer holiday pay may permit unpaid leave or additional vacation leave.
These models help balance fairness and flexibility, especially for hourly employees with irregular schedules or overtime hours worked.
Exempt and non-exempt employees
The distinction between hourly employees and exempt employees (those on fixed salaries) is important. Salaried employees usually continue to receive pay even when not working on a public holiday, while hourly employees must rely on explicit holiday pay policy rules.
This can create confusion in mixed workplaces. Employers should explain whether hourly workers receive paid holiday time or unpaid time, and how overtime pay interacts with holiday pay if a shift extends beyond regular hours worked.
Overtime and holiday pay interaction
In many countries, holiday pay does not count toward overtime pay calculations, because overtime pay applies only to hours worked.
However, if an employee works during a recognized holiday and those hours worked exceed the legal weekly threshold, overtime pay applies in addition to premium pay (e.g., time and a half or double pay).
Employers should clarify this in their holiday pay policy to prevent misunderstandings, particularly where collective bargaining agreements may apply.
Setting a fair holiday pay policy
A transparent holiday pay policy benefits both employers and workers. It should:
- Define which recognized holidays are covered
- Specify how holiday pay is calculated (rate of pay, premium pay, or paid holiday time)
- Clarify eligibility for part time employees and hourly employees
- Outline procedures if a holiday falls on a weekend
- Include guidance on floating holidays or religious holidays
Employers who offer holiday pay or provide holiday pay beyond what’s required by state laws often gain a reputation for fairness and attract eligible employees who value stability and predictable holiday time.
How collective bargaining agreements shape pay
In unionized workplaces, collective bargaining agreements often detail exactly how holiday pay is handled. These agreements may require private employers to provide holiday pay for certain holidays or pay time and a half if the employee works on those days.
Such agreements also protect part time employees and ensure equitable holiday pay practices across departments. Clear provisions on overtime pay, paid holiday time, and vacation leave are typical inclusions.
Religious holidays and reasonable accommodation
In a multicultural workforce, religious holidays require sensitivity. While companies aren’t always obligated to provide holiday pay for them, many include optional floating holidays for observance.
Employers should make reasonable accommodations when a worker requests time off for a religious holiday, as long as it doesn’t cause undue hardship. Alternatives include shift swaps, unpaid sick leave, or using accrued vacation leave.
A flexible approach helps accommodate employees and promotes inclusivity.
When a holiday falls on a non-working day
When a holiday falls on a non-working day, many employers move the benefit to the preceding Friday or following Monday.
For example, if Christmas Day or Labor Day lands on a Sunday, the observed paid day might shift. In workplaces that operate continuously, such as healthcare or hospitality, employees who work on these days often receive time and a half or double pay instead of a day off.
Paid vs. unpaid holidays
The difference between paid holidays and unpaid time can be significant for hourly employees. A paid holiday means compensation for a day not worked, while unpaid leave means no earnings for that day.
In countries where state laws require employers to provide statutory paid holidays, this benefit ensures predictable income. Elsewhere, it’s up to company policy.
Many businesses that offer holiday pay report higher retention and better employee morale, particularly during the holiday season when scheduling pressures rise.
Holiday pay and the benefits package
Including paid holidays in the benefits package demonstrates goodwill and helps reduce turnover. Along with paid sick leave, vacation leave, and paid time off, paid holidays make up part of a comprehensive employment offering.
When employers provide holiday pay, they strengthen workplace culture and set clear expectations about when staff are expected to work and when they can rest.
Examples of common holidays around the world
While specific holidays vary, here are examples frequently included in global holiday pay policy lists:
- New Year’s Eve and New Year’s Day
- Labor Day or May Day
- Christmas Day and Good Friday
- Memorial Day, Veterans Day, and Presidents Day (for North America)
- Election Day or Independence Day (in applicable countries)
State employees in various regions may also receive additional floating holidays or paid holiday time unique to local calendars.
Documentation and payroll accuracy
Employers must ensure payroll systems correctly track holiday pay, hours worked, overtime pay, and employee time to comply with labor laws.
Transparent records also prevent disputes and ensure consistency when calculating rate of pay, premium pay, or eligibility for paid holiday time. Modern software can automatically apply holiday pay rates and record when a holiday falls on non-working days.
Why offering holiday pay matters
Even where not legally required, offering holiday pay helps many employers retain skilled staff. It rewards hourly employees for flexibility, reduces burnout, and promotes fairness between salaried employees and hourly workers.
A fair holiday pay policy signals respect and makes it easier to manage schedules around floating holidays, religious holidays, and seasonal demand.
Balancing costs and morale
Some businesses worry that providing holiday pay will increase costs, but the trade-off often results in stronger employee morale, fewer absences, and smoother operations.
Employers require a reliable workforce, and paid holidays or paid holiday time help demonstrate appreciation for dedication and long hours worked. This is particularly valuable during peak holiday season trading.
So, do hourly employees get paid holidays?
The answer is: it depends. In some countries, state laws or labor laws require employers to provide holiday pay for recognized holidays; in others, it’s entirely up to the business.
To summarize:
- Paid holidays are common but not always mandatory.
- Private employers decide whether to offer holiday pay or give unpaid time off.
- Holiday pay practices vary worldwide, but floating holidays and religious holidays are increasingly common.
- A clear holiday pay policy ensures eligible employees know when they’ll receive holiday pay and under what conditions.
- Fair holiday pay fosters employee morale and supports diversity through reasonable accommodation.
Whether you’re an employer developing a holiday pay policy or an hourly employee wondering if you’ll get paid holiday time, transparency and fairness are key. When many employers prioritize offering holiday pay, everyone benefits—businesses retain motivated teams, and workers enjoy well-earned holiday time to recharge and celebrate.
