The term functions as a noun phrase. The core noun is "holidays," which is modified by the adjective "federal" and the relative clause "that require holiday pay." The entire phrase identifies a specific category or concept, making it the central subject of discussion.
In the United States, no federal law, including the Fair Labor Standards Act (FLSA), mandates that private-sector employers provide paid time off for holidays or pay a premium rate to employees who work on them. The designation of a day as a "federal holiday" legally applies only to federal government employees and institutions. For these employees, federal law does grant a day off with pay. If they are required to perform work on that day, they are entitled to holiday premium pay. For the vast majority of the workforce in the private sector, any entitlement to paid holidays or premium pay is determined by the policies established by their employer or the terms of a collective bargaining agreement.
Consequently, the obligation for an employer to provide holiday pay is a matter of agreement, not a statutory requirement for private businesses. Many companies choose to offer paid holidays as a competitive employee benefit to attract and retain talent. State and local laws can create exceptions; for example, some states mandate premium pay for employees in specific industries, such as retail, who work on certain holidays. However, these are not federal-level mandates. An employee's right to such compensation is therefore detailed within their employment contract or the company's official policy handbook, which outlines eligibility criteria and the rate of pay for working on a designated holiday.
