It is important to understand what bank holidays are and how it can affect your business.

A bank holiday is “a business day when financial institutions close their doors to the public and their employees take a day off.” Briefly, this means that brick-and-mortar banks are closed and direct deposits are not transferred to bank accounts of employees. A bank holiday shouldn’t be a matter of concern most of the time, but if the payroll schedule falls on a bank holiday, employees will be disappointed if they don’t get their paycheck as expected. Below you will find out more about what to do if you find a bank holiday.

How to Handle Bank Holidays and Payroll?

When you pay cash to your employees you don’t have to think about how payroll impacts a bank holiday, but most small business owners pay employees by direct deposit, and that’s when things can get complicated. You have three choices to make when payday falls on one of these bank holidays:

  • Pay your workers as scheduled, even with the holiday. If you take that option, know that your employees will be paid a day later than normal. Because of this, try to let the staff know so they can plan accordingly and don’t stress about losing a paycheck.
  • Run the payroll earlier. You will need to run the payroll one business day sooner to ensure your employees are paid before a bank holiday.
  • Accelerate the process. If you forget to run payroll earlier but still want your employees to be paid before the holiday, some payroll providers are offering flexible payroll options so you can pay to make your employees pay more quickly. At Nuage Digital, for example, we offer payroll options on the same day and next day so that you can speed up the process.

While your business may not be affected throughout the year by all bank holidays due to your payroll schedule, there are some things that you want to consider better prepared throughout the year.

Be consistent. If you’re heading the way to pay your workers before the bank holiday, keep following it all year round. It’s going to make things easier for you and your staff so they know what to expect.

Share the schedule of your payroll. It is common practice for employers at the beginning of the calendar year to share the payroll schedule with employees so that they know when to expect paychecks. Take note of bank holidays and anything else that might affect your employees when they are paid.

Stay organized. If you decide that you will be paying employees before the holiday, that means that you will be collecting and entering timesheets earlier. Make notes for yourself to make sure you do all you need to do in advance.


There is a good chance that your small business will find itself in a situation with bank holidays at least once a year. If you are using payroll service provider, you can get help with bank holidays and search for the expedited options mentioned above. If you’re going the DIY payroll route, the best thing you can do is stay organized and keep track of payroll processing deadlines.