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Juneteenth Holiday: What Employers Need to Know

Last Thursday, President Biden signed a law (Senate Bill 475) designating Juneteenth National Independence Day (June 19) as a legal public holiday. Here are answers to some frequently asked questions about the new law.

Q: What is Juneteenth?

A: It's a holiday that commemorates the end of slavery in the United States. The date of June 19 is significant because on that day in 1865, word reached enslaved individuals in Texas that they were free. Communities have been celebrating Juneteenth since 1866. Many states already recognize Juneteenth as a holiday.

Q: Did Senate Bill 475 apply to Juneteenth this year?

A: Yes, the change was effective immediately. For example, most federal employees had the day off Friday, June 18, 2021 (because Juneteenth fell on Saturday).

Q: Are private employers required to offer employees paid time off on Juneteenth?

A: Unless obligated by contract or agreement, private employers are generally not required to provide paid time off to non-exempt employees (those entitled to minimum wage and overtime) on any holiday*, including Juneteenth. However, if your company closes on Juneteenth (or any other holiday), exempt employees (those who meet specific salary and duties requirements) must generally still receive their full salary, as long as they work any part of the workweek.

* Note: Under federal and many state laws, employers are generally required to provide reasonable accommodations for employees' sincerely held religious beliefs and practices, unless doing so would impose an undue hardship on the business. This may include providing time off for religious observances.

Q: What if I offer paid time off on other legal public holidays, must I now include Juneteenth?

A: Employers may generally choose which (if any) holidays to observe as paid ones. Given the significance of Juneteenth, employers may want to consider recognizing it as a paid holiday.

Q: Since the announcement of the new federal holiday came so close to June 19, I didn't have time to prepare to give employees the day off this year. Can I wait until next year to observe it as a paid holiday?

A: As mentioned above, employers generally have the right to choose which (if any) days to observe as paid holidays. Therefore, you can generally begin observing it as a paid holiday next year if you are unable to do so in 2021. Since there's a lot of media attention around the announcement, employers may want to communicate their plans once they're finalized.

Q: How are most employers handling Juneteenth this year?

A: It's unclear how many employers will handle Juneteenth this year as a result of Senate Bill 475. In the wake of racial justice initiatives in 2020, though, many employers joined the list of companies that have made a practice of observing Juneteenth as a paid holiday, and more employers are likely to join them now that it's a federal holiday. Other employers will continue to offer floating holidays that employees can use on any day, including Juneteenth. Many employers are also recognizing Juneteenth in the workplace through companywide communications and events.

Q: If we remain open on Juneteenth, am I required to pay non-exempt employees a premium for working that day now that it's a federal holiday?

A: Under federal law, there's generally no requirement to pay non-exempt employees a premium for working on a holiday, unless it results in the employee working more than 40 hours in the workweek. However, there are exceptions in some states where some employers may be required to provide premium pay regardless of how many hours the employee worked. For example, Massachusetts requires retail establishments with seven or more employees (including the owner) to pay a premium of 1.2 times the employee's regular rate for work on Juneteenth and certain other legal holidays in 2021 (this premium-pay requirement is being phased out in subsequent years). Absent a state requirement, some employers choose to offer premium pay to employees as an incentive to work on a holiday.

Q: Can I require employees to work on Juneteenth?

A: Check your state law, which may have restrictions. For example, Massachusetts prohibits certain employers from requiring employees to work on Juneteenth (and certain other holidays).

Q: What happens if Juneteenth falls on a weekend?

A: If June 19 is a Saturday, the federal government will observe Juneteenth on the preceding Friday. If June 19 is a Sunday, the federal government will observe Juneteenth on the following Monday. Many employers will follow the same practice.

Q: What if Juneteenth falls on a payday?

A: If a scheduled payday falls on a holiday, some states require payment on the preceding business day. Absent such a requirement, employers generally have the option of paying employees on the day before or after the holiday. If your check date falls on a bank holiday and you wish to pay employees the day before, adjust your check date to avoid delaying payroll delivery.

Conclusion:

Make sure you understand the rules that apply to your business and clearly communicate, and consistently apply, your policy on holiday pay.

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