Q: Am I required to pay overtime to employees who work on holidays?
A: In most states, whether you pay extra for work done on holidays is up to you. There is no federal law that requires an employer to pay extra for work on holidays. However, some states, such as Massachusetts, require that work for certain employers on holidays be voluntary and paid at time and a half.
As for overtime, if an employee has already worked 40 hours during that workweek, and then works on a holiday, the holiday should be paid at the applicable overtime rate.
While usually not required by law, offering additional pay for work on holidays can be a nice financial incentive and reward.
Three suggestions for rewarding employees who are working on holidays:
- Pay time and a half or double time for all hours worked on the holiday;
- Add an extra eight hours to the checks of employees who worked; or
- Place eight hours into a “floating holiday” bank for employees who worked so they can take time off at a later date.
If you decide to provide additional pay for holidays, be sure to do so in a non-discriminatory and consistent manner for all employees.
Studies show that employees consider vacation time and workplace flexibility one of their most valuable benefits – second only to health insurance.
This guide will help you understand how to structure and implement a time off policy that works for your organization.