Thanksgiving is always one of my favorite holidays. Time to gather with family and friends, eat fabulous food, and be grateful for so many blessings. For HR professionals, however, holidays and headaches often go together as they face holiday pay questions, and Thanksgiving is no different.

Many employees believe they are entitled to be paid for holidays, even if they do not work on the holiday. This is not the case. In fact, neither the Fair Labor Standards Act (FLSA) nor most state laws, including Ohio’s, require a private employer to pay hourly employees for working or not working on holidays (federal or otherwise). (For employers in Massachusetts, however, be sure to check your Blue laws.)

This type of pay is typically considered a fringe benefit and is a matter of agreement between an employer and an employee (or the employee’s union representative). However, Please note that this does not apply to salaried, exempt employees who get paid for holidays (even ones they don’t work), because the law prohibits employers from making wage deduction if the company is closed on a holiday.

What if an employer pays employees for holidays for which they don’t actually work?

Some employers may choose to pay their employees for a holiday, e.g., 8 hours for Thanksgiving, so it is important that employers understand the FLSA and comparable state law overtime implications. While employers may choose to pay employees for an additional 8 hours on a holiday they did not work, these additional 8 hours of time that did not constitute actual work cannot be used to go into a calculation for overtime purposes. Federal and most state laws require employers to pay nonexempt employees one and one-half times their regular rate for each hour worked over 40 in a workweek. These non-worked hours don’t count.

Here’s what it looks like in application:

Let’s say an employee works 42 hours in a workweek and gets an additional 8 hours of pay for Thanksgiving, even though the employee did not actually work on that day. The employee earns $10 an hour. The employee is entitled to 48 hours of straight pay and 2 hours of overtime, not 40 hours of straight pay and 10 hours at time and a half.

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