Banks do not process financial transactions on federal holidays.
That means payroll direct deposits scheduled for a bank holiday will be processed the next business day.
When payday falls on a bank holiday, most businesses pay their employees a day early.
Depending on where your employees work and the type of industry you operate in, your state may provide guidelines for the type of payroll schedule you need to follow.
In addition, the Fair Labor Standards Act Basic Wage Standards require that you pay employees on a regular, predetermined payday each pay period.
The Federal Reserve Bank observes 11 holidays:
- New Years Day
- Martin Luther King, Jr. Birthday
- President’s Day/Washington’s Birthday
- Memorial Day
- Juneteenth National Independence Day
- Labor Day
- Columbus Day
- Veterans Day
- Thanksgiving Day
- Christmas Day
For bank holidays that fall on Sunday, Federal Reserve Banks and Branches will be closed the following Monday. When holidays fall on a Saturday, Federal Reserve Banks and Branches will be open the preceding Friday.
Learn more about how bank holidays impact small business payroll and get tips to prepare.
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