Federal Holidays: What It Means for Employers

What it means in practice

Federal holidays come from 5 U.S.C. 6103(a), which names the legal public holidays: New Year's Day (January 1); Birthday of Martin Luther King, Jr. (third Monday in January); Washington's Birthday (third Monday in February); Memorial Day (last Monday in May); Juneteenth National Independence Day (June 19); Independence Day (July 4); Labor Day (first Monday in September); Columbus Day (second Monday in October); Veterans Day (November 11); Thanksgiving Day (fourth Thursday in November); and Christmas Day (December 25). Six of the eleven follow a weekday rule, so they always fall on a Monday or, for Thanksgiving, a Thursday. The other five are fixed calendar dates that can land on a weekend.

Who the list applies to. The statute's weekend rules apply "for the purpose of statutes relating to pay and leave of employees," and the Office of Personnel Management (OPM) describes section 6103 as establishing the public holidays for federal employees. For private employers, the Department of Labor says the Fair Labor Standards Act (FLSA) does not require payment for time not worked, such as vacations or holidays (federal or otherwise), and that these benefits are generally a matter of agreement between employer and employee. A private employer can therefore follow the federal list, use part of it, or set its own, for example with a floating holiday or a combined paid time off (PTO) bank.

How the list has changed. The statutory notes to section 6103 trace the modern calendar. Pub. L. 90-363 (1968) moved Washington's Birthday, Memorial Day and Veterans Day to Mondays and added Columbus Day, effective January 1, 1971. Pub. L. 94-97 (1975) returned Veterans Day to November 11, effective January 1, 1978. Pub. L. 98-144 (November 2, 1983) added the Birthday of Martin Luther King, Jr., effective on the first January 1 after the two-year period following enactment, which was January 1, 1986. Pub. L. 117-17 (June 17, 2021) added Juneteenth. Names vary in practice: OPM says it always uses the statutory names, such as "Washington's Birthday," while noting that state and local governments and private businesses may use others, and IRS Publication 15 (2026) lists October 12 as "Indigenous Peoples' Day (Columbus Day)."

Weekend holidays: the "in lieu of" rules. For federal employees whose basic workweek is Monday through Friday, a holiday that falls on a Saturday is observed on the Friday immediately before (5 U.S.C. 6103(b)(1)), and one that falls on a Sunday is observed on the next workday (Executive Order 11582, sec. 3(a)). The same rules cover "any other day declared to be a holiday by Federal statute or Executive order." OPM's "In Lieu Of" fact sheet adds the details: all full-time employees, including those on flexible or compressed schedules, get an in-lieu-of holiday when a holiday falls on a nonworkday; the general rule is the workday immediately before the nonworkday, except that a Sunday holiday moves to the workday after. Part-time and intermittent employees are not entitled to an in-lieu-of holiday; a part-time employee gets a holiday only if regularly scheduled to work on the actual holiday. Agencies may not let employees pick a different in-lieu-of day, except that an agency head may designate another day for compressed schedules to prevent an "adverse agency impact" (5 U.S.C. 6103(d)).

The 2026 and 2027 calendars. OPM publishes the observed dates each year. In 2026, Independence Day falls on a Saturday, so most federal employees observe it on Friday, July 3. In 2027, three holidays fall on weekends: Juneteenth (Saturday, observed Friday, June 18), Independence Day (Sunday, observed Monday, July 5) and Christmas Day (Saturday, observed Friday, December 24). New Year's Day 2028 is also a Saturday, so OPM's 2028 schedule lists it as Friday, December 31, 2027, which gives federal employees twelve observed holidays within calendar year 2027. Because these shifts change every year, an employer that copies the federal calendar needs the current OPM table, not last year's.

Inauguration Day. Section 6103(c) adds January 20 of each fourth year after 1965 as a legal public holiday, but only for pay and leave of federal employees and District of Columbia government employees working in the District of Columbia; Montgomery and Prince George's Counties in Maryland; Arlington and Fairfax Counties in Virginia; and the cities of Alexandria and Falls Church. If January 20 is a Sunday, the next day selected for the public observance becomes the holiday. OPM notes that January 20, 2029 falls on a Saturday: only employees scheduled to work that Saturday may be excused with holiday pay, and the holiday is not observed on another day.

Holiday work and overtime. The Department of Labor states that the FLSA does not require overtime pay for work on Saturdays, Sundays, holidays or regular days of rest unless overtime is worked on those days, meaning hours over 40 in the workweek; see overtime. Two federal regulations explain how holiday-related pay interacts with that rule. Under 29 CFR 778.203, a premium of at least time and one-half paid for work on a holiday may be treated as an overtime premium and credited toward overtime due; a smaller premium must be included in the regular rate. Under 29 CFR 778.218, pay for occasional idle periods such as a holiday, in amounts roughly equal to normal earnings, may be excluded from the regular rate, but none of it may be credited toward overtime due. Both regulations read "holiday" in its ordinary sense: a day customarily observed in the community in celebration of some historical or religious occasion, not a day off given because of lack of work.

Example: working through a paid holiday. The regulations give this illustration (29 CFR 778.219(a)(2)): an employee paid $12 an hour is entitled under his contract to 8 hours' pay for the Christmas holiday, forgoes the holiday, works 9 hours that day and 50 hours that week. He is owed $600 straight time for 50 hours, plus $96 holiday pay, plus $60 overtime premium (10 hours at an extra $6), for a total of $756. The holiday pay does not raise his $12 regular rate, and none of the $96 counts toward the $60 overtime premium.

Federal service and construction contracts. Federal holidays matter more directly for some government contractors. The Department of Labor says that on covered service contracts, holiday requirements are set out in the McNamara-O'Hara Service Contract Act wage determinations, and under the Davis-Bacon and Related Acts holiday pay is required for a worker classification only if the wage determination specifies it. For service contracts, 29 CFR 4.174 explains that most fringe benefit determinations list named holidays; an employee who does any work in the workweek of a named holiday is generally entitled to the holiday benefit, even if the holiday falls on a Sunday or a day off; a full-time employee receives a full day's pay up to 8 hours; and one who works on the holiday receives that amount in addition to pay for the day's work, or another paid day off, unless the determination sets a different standard.

Tax deadlines. Under 26 U.S.C. 7503, when the last day for an act under the internal revenue laws falls on a Saturday, Sunday or legal holiday, the act is timely if performed on the next day that is none of those. "Legal holiday" means a legal holiday in the District of Columbia, and for filings at an IRS office outside the District it also includes a statewide legal holiday in that state. IRS Publications 509 and 15 (2026) list 12 legal holidays for 2026: the 11 federal dates (with July 3 as Independence Day observed) plus April 16, District of Columbia Emancipation Day. Publication 15 adds that a statewide legal holiday does not delay a federal tax deposit, and that semiweekly depositors get an extra day for each legal holiday among the three weekdays after a semiweekly period ends.

Example: holiday weeks on the semiweekly schedule. Publication 15 says taxes on wages paid Wednesday through Friday are deposited by the following Wednesday, and taxes on wages paid Saturday through Tuesday by the following Friday. Applying that to 2026: for wages paid Friday, September 4, the deposit normally due Wednesday, September 9 moves to Thursday, September 10, because Monday, September 7 (Labor Day) is a legal holiday. For wages paid Tuesday, June 30, the deposit normally due Friday, July 3 moves to Monday, July 6, because July 3 is on the IRS list as Independence Day observed. Deposits are typically made through EFTPS.

Bank holidays and direct deposit. The Federal Reserve's K.8 schedule follows the same eleven holidays but treats weekends differently: when a holiday falls on a Saturday, Federal Reserve Banks and Branches are open the preceding Friday (the Board of Governors is closed), and when it falls on a Sunday, all Federal Reserve offices close the following Monday. So the Reserve Banks are open on July 3, 2026 and on June 18, December 24 and December 31, 2027, all of which are federal-employee holidays, but closed on July 5, 2027. April 16 is not on the K.8 list. The Federal Reserve Financial Services FedACH schedule for 2026 shows, for example, processing ending December 24 at 11:30 p.m. ET and resuming December 27 at 5:30 p.m. ET around Christmas, and ending July 3 at 11:30 p.m. ET and resuming July 5 at 5:30 p.m. ET around Independence Day. That matters when a direct deposit payday lands near a holiday; see also Automated Clearing House (ACH).

Where states differ. States set their own holidays for state government, and two official pages show how different they can be (examples only). The Texas Comptroller's fiscal 2027 schedule, which cites Texas Government Code Chapter 662, closes offices on the day after Thanksgiving (November 27, 2026) and Christmas Eve (December 24, 2026), lists skeleton-crew holidays such as Confederate Heroes Day (January 19, 2027), Texas Independence Day (March 2, 2027), San Jacinto Day (April 21, 2027) and LBJ Day (August 27, 2027), does not list Columbus Day, and states that holidays falling on a Saturday or Sunday are not observed on another day. California's CalHR state holiday page lists March 31 and the day after Thanksgiving, does not list Juneteenth or Columbus Day, observes a Sunday holiday on the following Monday, and gives holiday credit when a holiday falls on a Saturday. The California Labor Commissioner's holiday FAQ says state law does not require paid holidays, does not require a business to close on any particular day, and requires no holiday premium beyond overtime for hours over eight in a workday or 40 in a workweek. Check your own state's official pages.

Recordkeeping. For non-exempt employees, 29 CFR 516.2 requires records of hours worked each workday and each workweek, and of the amount and nature of each payment excluded from the regular rate, which includes holiday pay for time not worked when it is excluded under the rule in 29 CFR 778.218.

Questions employers ask. Must a private business close on federal holidays? The Department of Labor pages cited here describe holidays as a matter of agreement, and the California FAQ says the same under state law. When July 4 is a Saturday, which day is the holiday? For most federal employees, Friday; the Reserve Banks open that Friday, but the IRS treats it as a legal holiday (July 3, 2026). A private employer's own policy sets its observed day. Does a state holiday extend a federal tax deposit? No, according to Publication 15. Is Inauguration Day a holiday everywhere? No; section 6103(c) limits it to federal and DC government employees in the Washington area.

Why it matters and common mistakes

How Remindax helps

Related terms

See all terms in Leave & Time Off or browse the full HR Glossary.