Employees typically receive premium pay, calculated at 1.5 times their regular hourly rate, for hours worked on designated holidays or beyond a specified number of hours within a given timeframe. For instance, an employee earning $15 per hour would receive $22.50 per hour for any qualifying overtime or holiday hours.
This premium compensation structure serves several important purposes. It compensates employees for working less desirable shifts or exceeding their standard work schedule. It can also incentivize employees to take on extra shifts when needed, benefiting both the employee and the employer. Historically, premium pay developed alongside labor movements advocating for fair compensation and reasonable working hours.