HR Hotline: How Do We Pay Our Employees for Holiday Weeks?

Q: In the coming months, our facility will be closed for several holidays, each of which falls on a Thursday–Thanksgiving Day, Christmas Day, and New Year’s Day. These are paid holidays for our employees.

We are considering also closing our facility on the Fridays that follow each holiday. How would we manage our payroll for those weeks? Must we provide an additional paid holiday for each Friday? May we require our employees to use their PTO? 

A: Many employers struggle with this issue. You’re happy to give your employees a much-needed break with paid holidays, but you’re reluctant to incur the expense of doubling that allowance simply because of where they fall in the week.  

How you handle your employees’ pay will depend on their exemption status.

And because the rules are different for exempt vs. non-exempt workers, it’s crucial that you understand the difference.

Let’s address your non-exempt (usually hourly) workers first. 

Non-Exempt Workers

Employers must pay non-exempt employees for hours that they work – period. 

And if you have enough employees to be covered by Connecticut’s paid sick leave law, you must also provide one hour of paid sick leave for every 30 hours worked, up to a maximum of 40 hours per year.

Employers are not, however, required to provide any paid holidays or paid vacation. Nor are they required to pay non-exempt workers during a shutdown, regardless of its duration (unless a collective bargaining agreement says otherwise).

Employers are not, however, required to provide any paid holidays or paid vacation.

This means that you need not pay your non-exempt employees for the days you’re closed following a holiday. 

With the absence of any legal requirements here, you need only follow your own holiday and paid-time-off policies.

To that end, you may implement a policy that requires non-exempt workers to use PTO (as opposed to paid sick leave) on these days. If you do not require this, the days will be unpaid.  

Exempt Workers

It’s a different story for your exempt workers. 

Exempt employees must be paid on a salary basis, which means that they receive the same, predetermined compensation for each pay period, regardless of the number of days or hours worked.

With some very limited exceptions, an employer may not reduce an exempt employee’s pay. 

This means that your exempt employees will receive their usual paychecks, even if you decide to close on the days following a holiday. 

So plan ahead, classify (and pay) your employees correctly, and enjoy the holidays. 

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HR problems or issues? Email or call CBIA’s Diane Mokriski at the HR Hotline (860.244.1900). The HR Hotline is a free service for CBIA member companies and is intended to provide general information and does not constitute legal advice. Please consult with legal professionals for specific guidance for your situation.