09/02/2026
🇺🇸Labor Day is Monday — so here's a question employers tend to hear this time of year:
“Do we have to pay employees extra because it's a holiday?”
Not necessarily.
For most private employers, simply being a federal holiday doesn't automatically require paid time off or time-and-a-half for employees who work.
But there's an important distinction:
Holiday pay and overtime pay aren't the same thing.
If a covered, nonexempt employee's hours actually worked put them over 40 for the workweek, overtime requirements may still kick in. Paid holiday hours when no work is performed generally don't count as hours worked toward that 40-hour threshold.
Your handbook, employment agreement, union agreement, or established company policy may also provide holiday benefits beyond what the law otherwise requires.
💡 Employer takeaway: Before the holiday weekend, make sure whoever approves payroll knows exactly what your company's holiday-pay policy says. Consistency matters.
Save this one for Monday's payroll questions. 🇺🇸
