HR Guide to Federal Holidays in 2025: How to Navigate Leave & Payroll

When Are the Federal Holidays in 2025?

There are 11 federal holidays that most companies observe, including: 

This year, no federal holidays fall on a weekend. When that happens, leave typically occurs on Friday for Saturday holidays and Monday for Sunday holidays

Do Companies Have to Give Employees Federal Holidays Off? 

Navigating holiday pay policies can be tricky, but understanding the legal framework is key to staying compliant with both federal and state regulations. Here’s the foundation: the Fair Labor Standards Act (FLSA) does not require employers to provide paid time off for federal holidays. This means that decisions about holiday pay are often determined by company policies or collective bargaining agreements. But there are nuances to this general rule, so let's dig in.

Key Considerations for Federal Holiday Pay

Fair Labor Standards Act (FLSA) Overview

The FLSA is mostly hands-off when it comes to holiday pay, leaving much of the decision-making in your hands. Here’s what you need to know for different employee classifications:

• Non-Exempt Employees: These hourly workers aren’t automatically entitled to holiday pay. Unless your company policy specifies otherwise, if they don’t work on a holiday, they don’t get paid.
• Exempt Employees: For salaried employees, it’s a different story. If they work any hours during a holiday week, they must receive their full salary—even if they take the holiday off.

Exempt vs. Non-Exempt: Who Gets What?

Making sense of the exempt vs. non-exempt distinction is critical for ensuring holiday pay practices are both legal and equitable:

• Exempt Employees: Their pay remains consistent, regardless of the holiday schedule. It’s one less thing to worry about for salaried team members.
• Non-Exempt Employees: Holiday pay depends entirely on your company’s policies. Without a specific provision, they’re only compensated for hours worked.

Holiday Pay for Part-Time Employees

Your part-time workforce might not have federal protections, but thoughtful holiday pay practices can go a long way toward boosting morale. Here’s the scoop:

• Federal Requirements: None exist, so offering holiday pay for part-timers is entirely up to you.
• Best Practices: Extend holiday pay options where possible—it’s a small investment that can yield big returns in engagement and loyalty.

State-Specific Holiday Pay Laws

The federal government sets the baseline, but some states raise the stakes. For example:

• Massachusetts and Rhode Island: Employers are required to provide holiday pay or premium rates for non-exempt employees working on designated holidays. Staying on top of state-specific requirements ensures compliance and avoids unnecessary headaches.

By understanding these distinctions and tailoring your policies thoughtfully, you’re not just ensuring compliance—you’re building a workplace culture where employees feel valued and supported.

Commonly Observed Federal Holidays in the Workplace

New Year’s Day

This holiday is a global celebration marking the commencement of the Gregorian calendar year. It symbolizes new beginnings, offering people a collective moment to reflect on the past and embrace a fresh start. In workplaces, it often serves as a time for goal setting and renewed enthusiasm for the year ahead.

Martin Luther King Jr. Day

Celebrated on the third Monday in January, this day honors the legacy of Martin Luther King Jr., a pivotal figure in the American civil rights movement. It serves as a commemoration of his tireless advocacy for racial equality and justice, as well as a call to action for individuals to contribute to positive social change. Many organizations use this day to engage in community service projects or educational initiatives that promote equality and inclusivity.

President’s Day

Observed on the third Monday in February, this holiday honors the birthdays of George Washington and Abraham Lincoln. It serves as a time to reflect on the contributions of past U.S. presidents and the nation's history. Retailers often offer special sales, and workplaces may engage in patriotic activities or educational initiatives to highlight the significance of the presidency in shaping the country.

Memorial Day 

This federal holiday falls on the last Monday in May. Memorial Day is a solemn occasion dedicated to honoring the men and women who sacrificed their lives in service to the United States. It is a day of remembrance and gratitude for the bravery of military personnel. Many communities hold ceremonies at cemeteries and memorials, and workplaces often participate by observing a moment of silence or supporting veterans' initiatives.

Juneteenth

Juneteenth, celebrated on June 19th, commemorates the emancipation of enslaved African Americans in the United States. Often, employees are encouraged to use this day off to engage in activities that promote an understanding of African-American history and culture. Observing Juneteenth signals a commitment to acknowledging and addressing historical injustices and promoting diversity, equity, and inclusion within organizations.

Independence Day

July 4th commemorates the adoption of the Declaration of Independence in 1776, marking the birth of the United States. Celebrated with fireworks and parades, as well as other patriotic displays, this holiday fosters a sense of national pride and unity. In the workplace, it often translates into festive activities like picnics or team-building events.

Labor Day

This federal holiday takes place on the first Monday in September. It is a tribute to the contributions of workers and the achievements of the labor movement. Often regarded as the symbolic end of summer, it provides an opportunity for relaxation and recreation. Workplaces may celebrate with barbecues or acknowledge the dedication and hard work of their employees.

Veterans Day

Observed on November 11th, this federal holiday honors military veterans. Most companies encourage employees to honor and thank veterans for their service. Workplaces may organize events, such as ceremonies or outreach programs, to express gratitude and support for veterans. There are also often community initiatives to assist and uplift veterans, fostering a sense of patriotism and unity among employees.

Thanksgiving

Celebrated on the fourth Thursday in November, Thanksgiving is rooted in the early interactions between Native Americans and Pilgrims, symbolizing gratitude and unity. At work, it's a time to express appreciation for colleagues and reflect on shared accomplishments. Many organizations participate in philanthropic activities that contribute to local communities and embody the spirit of giving.

Christmas Day

Christmas is a widely observed cultural and religious holiday, celebrating the birth of Jesus Christ. Beyond its religious significance, it's a time for generosity and festive traditions. It often brings about holiday parties and a spirit of goodwill that fosters positive relationships among colleagues.

Non-Federal and Religious Holidays

There are plenty of non-federal holidays that encompass a range of cultural and regional observances, such as:

• Easter
• Hanukkah
• Diwali
• Chinese New Year
• Holi
• Kwanzaa
• Earth Day

These holidays may or may not require work depending on employer policies. However, recognizing religious and cultural diversity through these holidays can boost employee satisfaction. Even if your organization does not offer paid time off for every federal and non-federal holiday, you can foster inclusivity with flexible scheduling and remote work options. Open communication and proactive policies contribute to a workplace culture that supports employees in celebrating their unique traditions.

Federal Holidays Payroll Management

Federal holidays bring more than just celebrations—they also bring unique payroll challenges. Whether it’s calculating pay, navigating overtime rules, or ensuring smooth payroll processing, careful planning is essential. Here’s how to make payroll management during federal holidays a breeze while keeping compliance and employee satisfaction front and center.

Holiday Pay: Breaking Down the Basics

• Holiday Pay vs. Overtime—Know the Difference: Under the Fair Labor Standards Act (FLSA), holiday pay isn’t considered “hours worked” and doesn’t contribute to overtime calculations. For example, if an employee works 40 hours in a week and also earns 8 hours of holiday pay, only the 40 hours count toward overtime eligibility.
• Overtime Calculations Made Clear: When non-exempt employees work more than 40 hours in a week, overtime must be paid at 1.5 times their regular rate. For example, if an employee works 44 hours during a holiday week, they’ll receive regular pay for the first 40 hours and time-and-a-half for the additional 4 hours worked.
• Premium Holiday Pay: Some companies go the extra mile by offering premium pay rates (e.g., time and a half) for employees working on holidays. If this premium is offered, it can count toward overtime calculations unless the employee also receives separate holiday pay.

Tips for Smooth Payroll Processing During Holidays

• Plan Ahead: Start processing payroll early to avoid holiday delays. Make sure all timecards are submitted on time, and double-check that hours worked are accurately recorded.
• Clear Communication is Key: Communicate holiday pay policies in advance, ensuring employees understand how holiday pay interacts with regular and overtime pay. Transparent policies reduce confusion and build trust.
• Compliance First: Federal laws set the standard, but some states have additional requirements. Review state-specific regulations to ensure your holiday pay policies align with all applicable rules.

Streamline with Payroll Software

Efficient payroll management doesn’t have to be overwhelming. Payroll software can take the complexity out of holiday pay processing:

• Accuracy You Can Trust: Automated calculations eliminate the risk of human error, ensuring holiday and overtime pay are processed correctly.
• Time Saved: Payroll systems streamline everything from time tracking to reporting, freeing up your team for higher-priority tasks.
• Compliance Confidence: Many platforms are updated regularly to reflect changes in labor laws, helping you stay compliant with federal and state regulations.

Managing payroll during federal holidays doesn’t have to be a headache. By understanding holiday pay rules, planning ahead, and leveraging payroll software, you can simplify complex processes, meet compliance requirements, and ensure employees feel valued—all while keeping operations running smoothly. It’s not just about crunching numbers: It’s about creating a system that works for everyone.

Paid Federal Holidays and Employee Wellbeing

Paid federal holidays in 2024 offer employees valuable time for rest and personal pursuits. Recognizing the significance of these breaks can go a long way in contributing to employee satisfaction and overall wellbeing. 

Wellhub takes this commitment a step further by providing comprehensive wellbeing solutions. Integrating Wellhub into holiday planning allows employees to access a diverse range of fitness activities, fostering physical and mental health during time off. Wellhub's programs cater to varying interests, ensuring a personalized approach to wellness.

From virtual fitness classes to mindfulness sessions, Wellhub enhances the employee experience, promoting a holistic approach to wellbeing. For more insights on optimizing employee benefits for wellness, talk to a Wellbeing Specialist who can provide tailored guidance for a healthier and more engaged workforce. 

References

• Remote. (n.d.). How to Build a Global Benefits Plan. Retrieved December 11, 2023 from https://remote.com/resources/research/global-employee-benefits-guide.