Posted by Tamara
What does “holiday pay” mean?
Holiday pay does not mean a higher rate of pay. According to professionals in Human Resources, holiday pay simply means the wages an employee gets for being off from work on a holiday.
Most employers offer their workers five to seven paid holidays per year. These holidays are selected according to the company’s policy and are completely at the company’s discretion. There is no law, however, that requires employers to provide paid holidays.
There isn’t an Alabama law or federal law that requires companies to pay extra for working holidays, either. In fact, companies are not required to pay extra for holidays, nights or weekends. Some employers do pay a premium for holiday hours, and unions often stipulate extra pay for holidays in their contracts.
Normally, however, an employee who works a week with a holiday will get paid for the hours worked, and an additional 8 hours of pay for the holiday at the employee’s regular rate.
Walter is off on New Year’s Day, a paid holiday at his company, but still works 40 hours that week. His paycheck would reflect 8 hours of holiday pay at his usual rate, and 40 hours of regular pay.
Federal law stipulates that employees who work more than 40 hours in a work are entitled to overtime pay. Walter’s hours do not qualify because he is receiving pay for hours he did not work. Federal law allows those hours to be paid at the regular rate.
Susie works 47 hours in a week with a paid holiday. She will receive 40 hours of regular pay, 8 hours holiday pay (at the regular rate) and 7 hours of overtime pay.
If Susie’s company paid time and a half for working holidays, her paycheck would be slightly different. For instance, Susie works those same 47 hours in a week where the holiday falls on a Thursday. She would be entitled to 32 hours of regular pay, 8 hours of holiday pay and 7 hours of overtime pay. In essence, Susie would receive 15 hours of overtime pay.
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