Is It Compensable? Federally Recognized Holidays

February 20, 2023, was Presidents' Day, one of several federal holidays occurring throughout the year in the United States. Private-sector employers are not required by federal law to give employees any federal holidays off. Nevertheless, many private companies provide at least some federal holidays off for their employees. Are those private-sector employers that choose to provide their employees with holidays off required to pay the employees for that time? It depends.

Under the Fair Labor Standards Act (FLSA), employers are required to pay hourly nonexempt employees only for hours actually worked. A private-sector company therefore is not required to pay hourly nonexempt employees for any hours not worked due to an employer-sponsored holiday. Private companies can, of course, still choose to provide their nonexempt employees with holiday pay for hours not worked.