Floating Holiday

A paid day off that employees can use at their discretion — unlike fixed holidays, floating holidays aren't tied to a specific date.

A floating holiday is a paid day off that an employee can use on any day they choose, subject to typical scheduling norms (manager approval, advance notice). Unlike fixed company holidays — which are set dates like Thanksgiving or Christmas — floating holidays 'float' and can be applied to days with personal significance: a religious observance, a birthday, a cultural celebration, or simply a day the employee wants off. Many companies provide 1–3 floating holidays per year in addition to fixed holidays and PTO.

Floating holidays exist partly for equity reasons. A company's fixed holiday schedule typically reflects the dominant cultural and religious calendar — US companies close for Christmas but not for Eid, Diwali, Rosh Hashanah, or Lunar New Year. Floating holidays give employees who don't observe the fixed holidays a way to take paid time off for their own observances without burning PTO. Some companies have moved toward eliminating certain fixed holidays (like Columbus Day) in favor of additional floating holidays to give all employees more flexibility.

The mechanics vary: some companies grant floating holidays as separate from PTO (use them or lose them by year-end, not paid out at termination), while others fold them into a single PTO bucket. Employees should check whether floating holidays roll over, whether they pay out upon resignation or termination, and whether there are restrictions on when they can be taken (e.g., blackout periods during peak seasons). For employees who observe non-standard religious holidays, floating holidays combined with a manager conversation are usually the right path before requesting unpaid leave.