HOLIDAY OVERTIME PAY: How is it & What it Means

Holiday Overtime Pay
Image Source: KCY at Law

The legislation governing holiday overtime compensation or work pay is continually evolving. As a result, it is more complicated than it first appears to determine whether employees who work overtime are entitled to holiday compensation. While it’s true that overtime work comes with a differential payment, companies’ policies differ too. However, the general agreement is that festive and federal holiday overtime work hours are usually time and a half pay. Anyway, let’s see what it’s about as well as what can influence this payment.

What is Holiday Overtime Pay?

Overtime pay is the compensation you receive for working past the regular working hours. If your regular workweek is 40 hours, for example, and you are eligible for overtime pay, working 50 hours in a given week entitles you to 10 hours of extra pay. If you qualify for overtime, it depends on your weekly salary and how many hours you put in.

There is a federal statute that covers holiday compensation, but there is no law forcing firms to give employees paid or unpaid time off on holidays (e.g., Christmas, Thanksgiving, etc.). Furthermore, no federal law requires businesses to give workers extra pay for working on holidays.

However, some businesses decide to pay workers throughout the holidays. Options for holiday pay include:

  • A kind of paid time off (PTO) associated with holidays that an employee receives
  • The additional compensation an employee receives for working on a holiday, such as overtime or double pay

What expenses should be covered by holiday pay?

The following are some of the expenses that a holiday pay covers;

#1. Regular voluntary overtime

Regular voluntary overtime is the additional work a worker has the right to decide whether to do or not. This simply means it’s not compulsory. The Employment Appeal Tribunal states that while evaluating an employee’s holiday pay, employers must take into account frequent voluntary overtime payments (EAT).

This only applies to the first four weeks of holiday pay (these four weeks of annual leave are a requirement set by the EU Working Time Directive). According to UK law, employees have the right to an extra 1.6 weeks of vacation time, and this time doesn’t have to include voluntarily performed over time.

#2. Normal non-guaranteed overtime

Normal non-guaranteed overtime is defined as work that is given to employees who are legally obligated to accept it even though the employer is not obligated to provide it. When figuring out the first four weeks of holiday pay, employers must take into account normal non-guaranteed overtime compensation.

Additional components of holiday compensation should include:

  • Bonus payments: At least four weeks of an employee’s paid vacation time must be taken into consideration if they regularly get bonuses.
  • Payments for commissions: If a worker receives a contractual, performance-based commission as part of their regular pay, they must get paid at least four weeks before their paid vacation.
  • compensation for travel time

Holiday Overtime Pay Amazon

Amazon, like most American companies, celebrates Thanksgiving. Each year, Amazon employees are given one day of paid time off to spend with their families. Thanksgiving dinner is organized by Amazon for its employees at its corporate headquarters. There are many other holidays that Amazon recognizes, but these are only a few. Because other holidays and accompanying customs, including Christmas and Easter, are significant to the business, Amazon is happy to observe them.

What does Amazon pay for additional holiday time?

Anyone who works during the holiday receives holiday compensation, and this is 1.5 times your hourly rate. If you work that day and are not on an RT schedule (reduced time, 36 hours), you will be paid time and a half in addition to 6 extra hours of holiday pay. You will receive a time and half compensation for the additional 8 hours of work.

What will my compensation for the holidays be?

To establish how much holiday pay you should receive, compute your average weekly earnings for the previous 52 weeks. Include any overtime, commissions, or bonuses when totaling your pay from the previous 52 weeks. After that, divide it by 52 to get your average weekly wage.

Does Amazon compensate its employees who work overtime with time and a half?

The majority of Amazon employees are covered by the Fair Labor Standard Act (FLSA). They are known as non-exempt employees, and they are also entitled to overtime pay.

All employees are required to get overtime compensation, which is equal to one-half of their regular wage for each hour worked in excess of 40 in a workweek, under the Fair Labor Standards Act (FLSA).

Holiday Overtime Pay Calculator

If a worker qualifies for overtime pay, it could be challenging to estimate the correct rate. Companies must base their overtime charges on weekly work hours according to US federal law. It simply means that employees that work more than forty hours during a holiday week, receive overtime compensation. In particular, they will be entitled to “time and a half” pay for every hour they put in over the necessary forty-hour workweek.

However, in certain states, employers are subject to more rules. California, for instance, has mandated daily overtime. If an employee works more than eight hours in a single day, they are entitled to “time and a half” pay for those additional hours. Think about the scenario below. If you are a Californian employee and you work eleven hours on Christmas Day, you’ll receive a “time and a half” payment for three of those hours.

One and a Half Hours

This type of overtime pay is calculated as being 50% higher than the employee’s hourly rate. Every hour of overtime you work earns you 1.5 times your regular rate. Think about putting in an extra 10 hours per week at your regular $20 per hour wage. In this case, you would be compensated $30 for each extra hour of work.

Making the Time and a Half calculation

To calculate the rate of overtime pay required by the federal government, multiply the employee’s base hourly wage by 1.5.

The following example will demonstrate how to calculate a worker’s “time and a half” rate. Let’s assume that an employee earns $20 per hour. For every hour of overtime worked, the employee will be paid $15. As a result, this worker will be compensated $30 for each hour of overtime.

Imagine that this person worked fifty hours over a holiday week. For the initial forty hours, they would be paid their standard $20 per hour salary. For the additional 10 hours, they would be paid $30 an hour.

The usual weekly pay for this employee is $800 for a forty-hour workday. For the additional 10 hours of work, they would be compensated $300. This suggests that the employee would receive $1,100 in pay during the holiday week.

Holiday Overtime Pay Work

It may appear that American overtime laws are complex and unclear. In addition to calculating overtime hours, you also need to take into account things like salaried overtime, professions that are excluded from overtime, and more. Despite the obscurity surrounding the holiday overtime work pay rate, most companies in the States observe.

How Do I Calculate Holiday Overtime Pay work?

The Fair Labor Standards Act (FLSA) of 1937 was passed in order to give employees several protections, including the right to work overtime for those who qualify. As was previously established, holiday pay overtime is not covered by the FLSA; nevertheless, when businesses provide their employees an option, overtime is calculated in compliance with federal law.

The normal overtime pay rate of time and a half is frequently calculated using a 40-hour workweek. This means that any hours worked over 40 are automatically paid as overtime and are paid at a rate of 1.5 times the usual pay rate. However, any hours worked on a paid holiday are automatically paid as overtime.

The other main way that holidays can result in overtime, even for businesses that don’t offer paid vacations, is through more hours worked (especially in retail and hospitality). If your company offers sales-based commissions, which usually increase during the December holiday season, remember to take those commission and bonus rates into account when planning your overtime compensation approach.

Federal Holiday Overtime Pay

Aside from the festive holiday season, employees will also receive overtime pay for overtime during the federal holiday period. You would anticipate that working on a government holiday would have perks like overtime pay. The rest of the country is off today, after all. Unfortunately, federal law does not require employers to give their employees overtime pay for working on holidays. In reality, holidays are paid just like regular workdays. Unless you put in genuine overtime hours, you get paid at your regular rate for working federal holidays. Overtime becomes applicable when you work more than 40 hours per week, or in some places, more than 8 hours per day. The majority of extra work is paid at your regular rate plus time and a half.

Additionally, even if your employer requires you to take holiday vacation time, they are not required to pay you. Therefore, any time off for holidays is regarded as unpaid time off unless your state has specific legislation or your firm provides holiday pay benefits to employees.

How Do Holiday Pay and Overtime Work Together?

According to the law, federal employees are entitled to federal holidays. Private employers are not compelled to observe the federal holidays. The same is true for state employees, who often observe holidays unique to their state. According to the law, every holiday is just another regular business day for everyone else. Private companies are not compelled to offer paid holiday time off, although they are free to.

Private companies are also only required to pay their employees for actual hours worked. This implies that your company is not compelled to pay you for any time off. Rather, they choose to give you in observance of a holiday. In essence, you receive unpaid vacation time.

Holiday Overtime Pay California

The minimum salary and overtime pay for covered employees are guaranteed, even though employers are not required to offer holiday time off. If a covered employee in California works more than eight hours per day, more than forty hours per week, or more than six days per week, they are entitled to overtime pay.

Overtime compensation is equal to 1.5 times the employee’s usual hourly rate for hours worked past eight in a given weekday or the first eight hours on the seventh consecutive workday. Overtime compensation is equal to double that amount for hours over twelve on a specific weekday and any hours above eight on the seventh consecutive workday.

Does overtime and holiday pay stack?

The answer is No. Employees who currently get a premium rate of 1.5 for their holiday shifts are not entitled to an additional overtime rate.

How much is holiday overtime pay at Amazon?

Full-time employees at Amazon receive seven paid holidays, and holiday overtime pays 1.5 times the regular hourly rate.

What is holiday pay in Texas?

For each hour worked, up to eight hours of holiday compensation are earned.

How do you calculate overtime for a holiday?

Think about a full-time employee’s typical daily schedule. 8 hours, then the total number of days off, including weekends, in a year (whether you work on them or not). This will disclose the number of holiday hours that a full-time employee will be paid for.

Is holiday pay mandatory Texas?

The majority of state laws, including those in Texas, do not require businesses to observe any holidays or to pay employees who take time off for holidays.

Can an employer withhold holiday pay?

It is generally unlawful to withdraw money (such as holiday pay) from a worker who does not complete their whole notice period unless there is a particular written clause in the employment contract that authorizes such deductions.

How many sick days do you get a year in Texas?

Laws in Dallas and Austin require companies to provide six to eight paid sick days annually, depending on the size of the business.

How do you calculate holiday pay for hourly employees?

If an employee receives time-and-a-half pay for working on a holiday, multiply that sum by two.


Irrespective of the company where you work, you’ll surely get compensated for working overtime during the festive or federal holiday season. However, it’s important you look through your company’s policy to see what’s obtainable.

Holiday Overtime Pay FAQs

Can I require employees to work on a holiday?

There may be limitations imposed by the legislation in your state, so do some research. For instance, in Massachusetts, companies can’t force workers to come in on certain holidays.

Employees who are required to work on a holiday are compensated at double their regular rate. Does the employee's regular rate of pay have to include this holiday premium compensation?

There may be limitations imposed by the legislation in your state, so do some research. For instance, in Massachusetts, companies can’t force workers to come in on certain holidays.

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