Keeping track of employee holidays can be challenging, especially if your business observes federal, bank, regional, religious, or company holidays. Manually adding holiday time off each year takes time and increases the risk of payroll errors and inconsistent holiday entitlements.
Holiday policies automate this process by automatically adding paid holidays to employees based on the policy they're assigned to. This helps ensure employees receive the correct holiday pay each year while reducing administrative work.
Whether your company observes federal, bank, religious, or custom company holidays, Holiday policies make it easy to manage them all in one place.
How to Create a Holiday Policy
Holiday policies are created under a Holiday policy type. Similar to other Time Off policies, you can create multiple Holiday policies under the same policy type to support different groups of employees.
For example, if your business operates in the US, you may create one Holiday policy for full-time employees who receive all Federal Holidays, and another for part-time employees who only receive specific company-paid holidays. Let's go through the setup step by step.
Part 1: Create the Policy Type
From the Time Off feature, navigate to the he Paid or Unpaid section (depending on your needs).
Click + Add type.
Select Holiday and click Add policy type.
Click Create first policy.
💡 Tip: Holiday policy types automatically repeat every year, so you only need to configure them once.
Part 2: Configure the Policy
Set up your Holiday policy settings.
Name your policy, for example US Holidays Full Time.
Next, decide whether to hide this policy from users, so they won't have access to it when requesting time off. If you don't enable this option, users won't see this policy in their time off view, but holiday entries created under this policy will still appear in their timesheets.
Decide whether time off will be presented in hours or days, and select the applicable work days for this policy.
Click Next step to configure the relevant holidays
Available calendars include:
Federal or bank holidays
Regional/national holidays
Federal Holidays
Religious Holidays
Connecteam automatically maintains the dates for internationally recognized holidays, so you won't need to update them every year.
Add a Custom Holiday
If your company observes a holiday that isn't included in one of the available calendars:
Click + Add custom.
Enter the holiday name.
Select the holiday date.
Click Save.
Custom holidays automatically repeat every year using the same date.
Part 3: Configure the Holiday Pay
Once you've selected your holidays, decide how much paid time employees should receive for each one.
For every holiday, choose whether employees receive:
Full day
First half day
Second half day
This allows you to accurately reflect your company's holiday policy without creating multiple holiday entries.
Please note: Half-day holidays configured in a Holiday policy are fully paid by the company. If employees should receive half a day paid by the company and use their own Time Off balance for the remaining half-day, you'll need to use two separate policies:
A Holiday policy for the company-paid portion.
A standard Time Off policy for the portion deducted from the employee's balance.
Part 4: Configure Limitations and Assignment
Continue configuring the remaining policy settings, such as assigning the policy to employees and configuring any limitations.
In the Limitations tab, you can define a Waiting period to determine when employees become eligible for the holidays included in the policy. For example, you may require employees to complete three months of employment before receiving paid holidays.
Next, assign the policy to the relevant employees. As my policy is only applicable for full time employees in the US, I'll assign it only to my full time employees.
Once you've completed the setup, click Save.
How Holiday Policies Work
After the Holiday policy is assigned to an employee, Connecteam automatically creates holiday entries for every enabled holiday included in the policy.
The holidays are automatically added to the:
Employee's time off balance log
Their timesheets
Schedule
This means admins no longer need to manually add recurring holiday entries each year, and holiday pay is automatically included when preparing payroll.
Important things to note
Holiday grants are created when the policy is assigned.
For example, if a Holiday policy includes Thanksgiving and an employee is assigned after Thanksgiving has already passed, they won't receive that holiday for the current year. They will automatically receive it the following year.
Removing a user from the policy
Removing a user from a Holiday policy removes any future holiday entries that haven't yet occurred. Historical holiday records remain unchanged.
Archiving a user
Archiving a user removes future holiday grants while preserving historical data for payroll and reporting purposes.
Frequently Asked Questions
Most of my staff is off for a holiday, but since we operate on the holiday a few will work and will get an extra vacation day. How can I add this vacation day to their balance?
If you have a limited time off policy in addition to a holiday policy, you can add a vacation day (or days) by editing the balance for existing employees. To do so, first navigate to the employee's user card. You can reach the user card via the Users feature on the sidebar or by hovering over their profile picture in the Time Off feature, and clicking on Profile.
On the user card, go to the Time off tab and find the relevant policy. Click on Edit balance. Add the number of hours that are equivalent to the number of vacation days they need to receive (1 day = 8 hours, 2 days = 16 hours).
To learn more about changing users' time off balance, check out this article.
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