Employee Pay During the Holidays

Beth Dean 12.10.14
39 Minimalist Laptop Desk

The holidays can bring up confusing questions on how to pay your employees, especially since there are different rules for employees who are exempt or not exempt from overtime pay under the Federal Labor Standards Act (FLSA) regulations. Here is a quick guide on how to pay each group during the holidays.

Holiday Pay for Nonexempt Employees
Nonexempt employees are those who must be paid an overtime rate of 1.5 times their regular rates of pay when working more than 40 hours in a week. As a reminder, the overtime pay must be paid on the next regularly scheduled paycheck and cannot be delayed or exchanged for paid time off to be used at a later date.

If your business is closed on a holiday, the FLSA does not require payment to your nonexempt employees for time not worked. However, if your company does pay holiday pay as a general practice, you are bound to company policy.

There is no FLSA requirement to pay a shift differential or premium for working on holidays, but again, if your company practice is to do so, you are bound to that company policy and must apply it equally and nondiscriminatorily among all employees.

Holiday Pay for Exempt Employees
Exempt employees do not have to be paid overtime pay. Their professions are ones that require independent, original, or advanced thought that is of significance to the company’s operations and therefore may not be completely encompassed in a 40-hour workweek. Please refer to the FLSAs various Fact Sheets or contact your HR Consultant at Nextep for more information on overtime exemptions.

If your company is closed on a holiday during a day of the week that the employee is regularly scheduled to work, the exempt employee must be paid for that time. Under the FLSA, an exempt employee’s pay cannot be docked for being absent because of an operational requirement, such as the company closing shop for the day.

If the company is closed for the entire workweek, the employee’s pay may be deducted for that week, but only if no work whatsoever, including checking company emails on a mobile device, was performed during that entire week.

For human resource guidance in determining how to properly pay your employees during the holidays, please contact Nextep’s HR Department.

Also on Nextep

Be Aware of These Red Flags For Incorrect Employee Retention Credit (ERC) Claims The IRS is urging businesses that claimed the ERC pandemic-era credit to review their eligibility as a key deadline approaches.  Here are 7 ERC red flags to watch out for that could delay your claim: Claiming for too many quarters: Qualifying for […]
Read more
Remember that new independent contractor rule coming soon? It’s the one that makes it harder for businesses to call a worker a “contractor.” As a reminder, that big change kicks in March 11, 2024. Why should you care? More workers might become employees. This means benefits like minimum wage, health insurance eligibility, paid time off, […]
Read more
What Businesses Need to Know Last week, we discussed collaborating with employees who request religious accommodations during Ramadan. This week, we’ll look at some of the nuts and bolts of religious accommodations at work and the impact of last year’s Supreme Court case, Groff v. DeJoy. The Groff v. DeJoy decision, as we covered when […]
Read more
Ramadan, the holy month of fasting and reflection for Muslims, begins on Sunday, March 10, 2024, and end on Tuesday, April 9. As an employer, understanding your Muslim employees’ needs during this time fosters a supportive and inclusive workplace.  It’s important to consider that rejecting flexible requests without a valid reason could be seen as […]
Read more
Workplace safety starts with good records. Every company must maintain records of worksite injuries and illnesses throughout the year. This recordkeeping is a legal requirement mandated by the Occupational Safety and Health Administration (OSHA). This quick guide simplifies the process, outlining your responsibilities. The Basics: Companies must document worksite injuries and illnesses for the entire […]
Read more
Big Change for Gig Work and More The Department of Labor (DOL) has revised its rules for classifying workers as independent contractors, making it more difficult for businesses to do so.  Effective March 11, 2024, this change impacts workers across the US and could have significant implications for businesses of all sizes. New rules make […]
Read more
Heads up, businesses! Beginning February 1, many workplaces must post a summary of work-related injuries and illnesses from the previous year. This simple one-page form, called the OSHA 300A, gives employees easy access to safety info specific to their worksite. Here’s the OSHA 300A rundown: Who needs to post? Companies with 11 or more employees […]
Read more
2023 and 2024 have seen several updates to federal law that impact your workplace labor posters. Are yours up to date? The new year allows you to check it out and avoid fines! Updates that affect your posters include (but are not limited to): PUMP Act for Nursing Mothers EEOC Pregnant Workers Fairness Act (PWFA) […]
Read more
At least 22 states and nearly 40 local jurisdictions will increase their minimum wage rates on January 1, 2024. Below is a summary of these changes and guidelines to help you comply with your minimum wage requirements. As a reminder, in cases where federal, state, or local regulations differ, the employer must use the law […]
Read more
Essential Updates for Employers in the New Year Heads up, employers: there are several new workplace laws and regulations in 2024.  The new year is just around the corner, bringing a wave of changes for employers nationwide. These regulations aim to create a fair and supportive work environment that attracts and retains top talent. Federal […]
Read more
Get ready to chart your company’s financial course for 2024! To assist in gearing up your company’s budget, here’s a breakdown of some key upcoming financial changes. 2024 Tax, FSA, and Retirement Updates   2024 2023 TAXES Social Security Wage Base $167,700 $160,200 FICA – Social Security (OASDI) 6.2%, up to wage base 6.2%, up […]
Read more
Confused by the ever-changing SUTA (State Unemployment Tax Act) landscape? We’ve compiled a comprehensive list of 2024 SUTA wage bases for each state, making it easier for you to stay compliant and manage your payroll taxes effectively. Simply find your state in the table below and discover the applicable wage base for the upcoming year! […]
Read more

Download Our App

Download the Nextep Mobile App in Apple iOS or Google Play