My Company Is Closing on the Holidays, Do I Get Paid?
With the holiday season upon us, it is an opportune time to review your company’s holiday pay practices. Learn what is required, so you know what funds you’ll have for end-of-year spending.
To begin with, it is important to understand that an employer is not required to provide its employees with time off (paid or otherwise) on nationally recognized holidays. Most companies, however, do offer a limited number of paid holidays to create employee goodwill.
Also, companies are required to provide reasonable accommodation for the religious practices of its employees. (See our previous blog: Religious Discrimination: What Holidays Can I Take off Work? for more information.)
The required pay practices for your company’s holiday time off are dependent on the type of employee.
Non-exempt (hourly) employees under the Fair Labor Standards Act (FLSA). Employers do not have to pay hourly employees for time off on holidays- absent a collective bargaining agreement. They are only obligated to pay hourly employees for time actually worked.
Note: If an employer provides paid holidays, the paid time off is not considered time worked when it comes to issue of overtime pay. An employee must actually work 40 hours in a week before they are eligible for overtime.
Exempt employees (salaried employees who do not get paid overtime). Not paying exempt employees may jeopardize their exempt status.
FLSA states that “exempt” employees must generally be paid a regular salary, regardless of the number of hours they work or the quantity/quality of their work. Therefore, exempt employees who are given the day off should receive their full weekly salary if they work any hours during the week the holiday falls.
As a reminder, the Department of Labor regulations implementing the FLSA state that the following categories of employees are exempt from the FLSA’s overtime and minimum wage requirements: (1) bona fide administrative, executive, or professional employees; (2) workers employed in outside sales; (3) highly skilled computer-related employees; and (4) certain “highly-compensated” employees.