History Lesson: What is Labor Day and Why Do We Celebrate It?

Sep 02, 2020

You can't wear white after Labor Day - everyone knows that! 

But did you know that Labor Day is among the top 5 paid holidays given by employers?

What is Labor Day? Why is it important? 

Labor Day pays tribute to the contributions and achievements of American workers, traditionally observed on the first Monday in September. It was created by the labor movement in the late 19th century and became a federal holiday in 1894. 

In the late 1800s, at the height of the Industrial Revolution in the United States, the average American worked 12-hour days, seven days a week in order to make basic ends meet. Despite child labor laws, children were still forced to work at fractional wages in order to help support their families. Working conditions were unsafe with no regulations for breaks and sanitary facilities. 

Fed up with this environment, labor unions started to form and organize protests to compel employers to renegotiate hours and pay - notably the 10,000 workers who took unpaid time off to march from City Hall to Union Square in NYC, considering this the first Labor Day parade. 

You can learn more details here.

Fast forward 126 years later, Labor Day weekend is mostly referred to as the "end of summer" for many Americans and is often a call for one last pool party. 

How do Employers typically observe Labor Day?

Historically speaking, corporate offices are closed for business and employees are fully or partially paid for the day (depending on employment status).

However, it's a different story for food and retail businesses as this is one of their busiest weekends and the start of holiday season shopping. Hence all the spam emails you'll get announcing Labor Day sales. Most retail businesses do not offer Labor Day as a company paid holiday. 

Many small businesses have a 3rd option: You can work if you'd like to, but if you don't - you won't be paid. 

And then there are the businesses that are closed for business but do not pay employees for the holiday nor offer them the ability to work. Bummer. 

What is the best option?

It depends. 

It's a competitive job market out there right now (despite the pandemic) and in order to retain talent - it's best to offer it as a fully paid holiday. 

What about retail? Offer full-time employees a floating day to take off at a later time. 

If a business is just starting or going through financial hardships, run an analysis to see if the business can afford to offer it paid. If not, communicate the reason to staff members and let them know that it will be reconsidered the following year. It wouldn't hurt to buy lunch for the team that day either. 

So if you are taking the day off fully paid - that's awesome. Celebrate the people before us who fought for better wages and working conditions so we can enjoy Summer's last hoorah. 

If you don't get to take the day off, kick butt in earning that commission or extra tips for your incredible service. People will notice and be grateful for you. 



For help on building out paid time off and paid holiday policies, email us at [email protected] or complete a contact form. 









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