Premium Pay on Holidays a Choice for Employers, Not a Requirement

Last month included Memorial Day, and I got a lot of questions from my employees about paying them extra for working on the holiday. Next month the 4th of July is going to fall on a Tuesday. Am I required by law to pay my employees overtime or double-time, if I have them work on the holiday?

Although state and federal laws recognize certain days as “holidays,” there is no law that requires private employers to provide a premium rate of pay for work on those days. These “holidays” are days that government offices are closed and do not provide services as they normally would.

As a result, the government makes the holiday designation to give people notice that services will not be available, and also allows employers an extra day to respond to official inquiries and/or to pay employees if a pay day falls on the holiday.

Many employers choose to offer premium pay for work on designated holidays as a benefit to their employees, but that would be a matter of contract between the employer and the employee.

No Legal Obligation

You have no legal obligation to pay your employees any differently for work on a “holiday” than you do for any other day of the year.

You can choose to pay your employees even though they don’t work on the “holiday,” but you are not required by law to do so.

Moreover, if you operate a business that is open on a “holiday,” you might choose to pay your employees more for working on that particular day, but any extra money you choose to pay your employees would be within your complete discretion since it is not required by either state or federal law.

You also must remember that as a general rule, if your exempt employee works any part of a workweek, you must pay that individual his/her full salary for the entire workweek.

Exempt Employees

In the case of a “holiday,” where the employer chooses to close the business for a day during the workweek, the employer still must pay exempt employees their full salary for the workweek without deduction for the “holiday.”

Thus, in the vast majority of situations, a “holiday” will have no impact on the wages paid to your exempt employees.

The Labor Law Helpline is a service to California Chamber of Commerce preferred and executive members. For expert explanations of labor laws and Cal/OSHA regulations, not legal counsel for specific situations, call (800) 348-2262 or submit your question at

Staff Contact David Leporiere