Fixed holiday calendars work well when everyone observes the same holidays. They fall apart as the workforce becomes more religiously and culturally diverse, because a calendar built around Christmas and Thanksgiving leaves out Diwali, Eid, Yom Kippur, Lunar New Year, and dozens of other days that matter to employees. Restricted holidays were designed to solve this problem: the employer publishes a list of approved days, and each employee selects the ones that matter most to them. The structure is common in India and the UK, and it's increasingly adopted by US employers with global or religiously diverse workforces.
How Restricted Holidays Work A typical restricted holiday policy defines two concepts. The approved list is published by the employer at the start of the year and usually includes 8 to 20 dates representing major religious and cultural observances from multiple traditions. The employee allocation is the number of days each employee can choose from the list, often two to four per year, treated like paid time off with advance notice requirements.
Restricted holidays are typically additional to fixed company holidays, not a substitute. The fixed list covers universally recognized days (like New Year's Day or national holidays); restricted holidays cover the rest.
Why Employers Adopt Restricted Holiday Policies The case rests on inclusion and practicality. Fixed holiday calendars implicitly assume the workforce shares one tradition. Restricted holidays acknowledge that different employees have different observances that matter, and build the accommodation directly into the PTO structure rather than forcing employees to burn personal days for religious observances.
The policy is especially common in companies with significant operations in India, the Middle East, or Southeast Asia, where the workforce spans multiple religious traditions. It's increasingly adopted in US workplaces too, as religious accommodation cases have clarified employer obligations.
Are Restricted Holidays the Same as Floating Holidays? Similar but not identical. Floating holidays are typically fully discretionary days off that employees can use for any reason. Restricted holidays are tied to a specific list of approved dates, often with cultural or religious significance. Some US employers combine the two by offering a "floating holiday" with the understanding that employees often use it for religious observance.
Designing a Policy That Accommodates Without Overcomplicating Publish the list in advance so employees can plan around it. Include dates from the traditions actually represented in the workforce, refreshing the list every year or two as the workforce changes. Set clear advance notice requirements (usually two to four weeks) so managers can plan coverage.
Handle overlapping requests through the same process used for other time off. Don't require employees to justify religious observance or document their tradition. The structure works best when it's unobtrusive: employees pick dates, submit requests, managers approve.
Integrating Restricted Holidays Into a Coherent Time-Off Strategy Restricted holidays pair well with broader diversity and inclusion practices, because the policy signals that the workforce's different traditions are recognized and accommodated. It also reduces the friction of ad hoc religious accommodation requests, which would otherwise come to HR one at a time under Title VII's reasonable accommodation standard.
Coordinate the policy with employee handbook , leave of absence , and onboarding materials so new hires understand the structure from the start. Reference the EEOC religious discrimination guidance and DOL Wage and Hour Division resources on PTO and holiday administration when designing the policy, particularly for multi-state and global workforces where each jurisdiction has its own rules.
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