Holiday pay

Meaning & Definition

Holiday Pay is the pay received by employees in respect of holidays, regardless of whether the employee works or takes leave on that particular day. It is the pay that covers all kinds of paid holidays, including public holidays, national holidays, and holidays declared by the company.

Important Features of the Holiday Pay

• Employees get paid during public and announced holidays.
• Increases employee happiness and quality of life.
• Helps businesses practice equitable payroll management.
• Fosters adherence to holiday and leave policies.
• Supports in retaining employees with proper incentives.

Applicable Regulations & Policies 

Indian Holiday Pay is covered by the following legislation and regulations:

• The National & Festival Holidays Act (applicable to specific states) provides for paid holidays during national and festival holidays.
• The Shops and Establishments Act (applicable to specific states) controls holiday policy and conditions of employment.

Employers have to ensure that there are holidays provided with pay, and can even provide extra compensation for those who choose to work during holidays.