Managing leave around public holidays in Ireland
Reviewed by Mellow Editorial Team, HR & payroll content team
Bank holidays in Ireland give employees an additional entitlement on top of their statutory four weeks of annual leave — but the rules around how that entitlement is given, and how public holidays interact with your payroll, trip up a lot of employers.
What the law actually says
There are ten public holidays in Ireland each year. Under the Organisation of Working Time Act 1997, most employees are entitled to a benefit for each one. That benefit can take one of four forms: a paid day off on the day itself, a paid day off within a month, an additional day of annual leave, or an additional day's pay. Which option applies depends on what you agree with the employee — but if you say nothing, the default is a paid day off on the day.
Part-time employees have the same entitlement in principle, but it is calculated proportionally. If a part-time employee does not normally work on the day the public holiday falls, they are still entitled to one-fifth of their normal weekly pay for that day.
When a public holiday falls on a weekend
This catches employers out regularly. If a public holiday falls on a Saturday or Sunday and your employee does not work weekends, they do not simply lose the entitlement. The benefit must still be given. In practice most employers grant an extra day off the following Monday, but you can also give an additional day's annual leave or an extra day's pay. The key point is that the entitlement does not disappear because the calendar is inconvenient.
How public holidays interact with annual leave
Public holidays do not count as annual leave. If an employee is on annual leave when a public holiday falls, that day should not be deducted from their leave balance — it needs to be given back or compensated separately. This is a common payroll error. Audit your leave records each time a public holiday falls mid-holiday and adjust accordingly.
Similarly, if an employee is on certified sick leave when a public holiday falls, they are still entitled to the benefit. You cannot withhold it on the grounds that they were absent.
Calculating pay for public holidays
For an employee on a fixed salary, calculating a day's pay is straightforward — divide their weekly salary by five (for a standard five-day week) or by their normal working days if they work a compressed schedule.
For employees on variable hours or irregular pay, the calculation is the average daily pay over the 13 weeks ending before the public holiday. You look at total earnings (excluding overtime) over those 13 weeks and divide by the number of days actually worked to get an average day's rate.
That average day rate then feeds into your payroll submission. Real-time reporting means you submit payroll to Revenue via ROS on or before each payday, so any additional pay for a public holiday needs to be included in the relevant payroll run rather than corrected after the fact. The pay is subject to income tax, USC and PRSI in the normal way — PRSI Class A runs at roughly 4.1% for the employee and 11.15% for the employer on that additional amount.
Building a reliable leave management process
A few practical habits will save you time and reduce the chance of disputes.
Maintain a single, shared leave calendar. Mark public holidays at the start of the year so the whole team can see them. This prevents employees booking annual leave over a public holiday without realising they are entitled to both.
Confirm your chosen benefit in writing. The Organisation of Working Time Act gives you flexibility, but employees need to know in advance whether they are getting the day off or an alternative benefit. Put it in contracts or your staff handbook.
Check entitlement for any employee who leaves mid-year. Public holiday entitlement accrues continuously. If someone leaves before taking all their public holiday benefits, any outstanding entitlement should be paid out in their final payslip, in the same way outstanding annual leave is.
Keep records for at least three years. Revenue and the Workplace Relations Commission can both request records of working time and pay. Payroll software that records each public holiday benefit separately — and links it to the correct payroll submission — makes compliance straightforward if you are ever audited.
Factor in the 2026 pension auto-enrolment changes. My Future Fund contributions will apply to qualifying employees from 2026. Any additional pay for public holidays, including once-off additional day's pay, is likely to fall within the earnings that attract contributions. Worth confirming this with your payroll provider as the scheme beds in.
The Organisation of Working Time Act is employee-friendly by design. Getting the administration right is not complicated, but it does require a consistent process and accurate record-keeping throughout the year.
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