The short answer: No, unless overtime hours are worked on such days, or your policy states that paid time off is counted as hours worked when calculating overtime.
The longer, more in-depth answer: If an employer pays holiday pay, there are no provisions in either North Carolina Department of Labor laws or the Federal Labor Standards Act which require the hours paid for holiday pay to count as hours worked for purposes of calculating overtime pay. Only hours actually worked are counted when figuring overtime pay.
Remember, holiday pay is not considered hours worked, so it is not part of calculating overtime hours for employees. Employers should not designate it as overtime when it occurs as part of a regular schedule, to prevent any misconceptions or confusion by their workers.
Keep in mind that when calculating how many hours a nonexempt employee actually works in a week, you do not have to count holiday hours towards the 40-hour workweek as pay. For example, say your employee usually works eight hours a day Monday through Friday and receives Monday, July 5 off for the upcoming holiday. He or she then works regular hours the rest of that week plus eight additional hours on Saturday. While his or her paycheck for the week would note a total of 48 paid hours, counting the eight hours for the holiday observed on July 5, he or she actually worked only 40 hours (eight hours five days including Saturday) and thus would not receive any overtime pay.
For more details, please call a member of CAI’s Advice and Counsel team at (919) 878-9222 or (336) 668-7746.
Photo Source: HAM guy