Poya and Holiday Pay in Sri Lanka: What to Pay
Poya day work is paid at not less than 1.5x the daily rate; a mercantile holiday is 2x or a substitute day, with the Commissioner's sanction.
On this page
- Which holidays must a private employer give?
- Poya days: the 1.5x rule
- Mercantile holidays: 2x pay or a day in lieu
- The weekly holiday worked
- Do this automatically in Humanised
- Can a shop open on a holiday?
- Worked examples on a monthly salary
- Frequently asked questions
- What if an employee works only half a day on a Poya day?
- Does the 1.5x or 2x rate change for a shift that crosses midnight?
- Can an employee volunteer to work a mercantile holiday without the Commissioner's sanction?
- Do part-time or shift workers get the same Poya and mercantile holiday pay?
- What happens if a Poya day and a mercantile holiday fall on the same date?
An employee who works a Full Moon Poya Day must be paid at least 1.5 times their normal daily rate for that day. An employer needs the Commissioner of Labour’s prior sanction before staff work a Gazetted mercantile holiday. The employer must then give the employee either a paid day in lieu by 31 December, or double pay for that day. Different sections of the Shop and Office Employees Act govern the two holidays, and they pay differently.
Which holidays must a private employer give?
Shop and office employees in Sri Lanka get three kinds of paid time off. All three come under the Shop and Office Employees Act. They are: a weekly holiday (s.5), every Full Moon Poya Day (s.7A), and up to nine mercantile holidays a year (s.7). The Minister declares mercantile holidays by Gazette. Full 2026 dates, mercantile flags and the calendar are in mercantile holidays and Poya days 2026. The rest of this article covers what happens when an employee works one of these days instead of taking it off.
Poya days: the 1.5x rule
Section 7A of the Act gives every shop and office employee a holiday on each Full Moon Poya Day. Section 7B lets an employer require work on a Poya day for a normal period of employment. There is one condition. The employee “shall be paid not less than one and a half times his normal daily rate of remuneration” for that day. No prior sanction from the Commissioner of Labour is needed to work a Poya day. A mercantile holiday needs that sanction instead. The 1.5x rate is the trade-off. A Poya day can fall on a weekly holiday, a weekly half-holiday, or a declared mercantile holiday. When that happens, no extra day off is due for the Poya day itself (s.7A proviso). It is treated as already covered by the other holiday.
Mercantile holidays: 2x pay or a day in lieu
Section 7 gives shop and office employees a paid holiday. This covers each of the up to nine days the Minister gazettes for the purpose. Unlike a Poya day, working a mercantile holiday needs the Commissioner of Labour’s prior sanction. The Commissioner will not grant it unless satisfied the business cannot allow the holiday without prejudice to its operations. In plain words, giving the holiday would damage the business. Where sanction is given and the employee works, the employer must either:
- allow a substitute paid holiday on or before 31 December that year, or
- pay the employee double the rate they are ordinarily paid for that day’s work.
The choice between the two is the employer’s, not fixed by the Act. A retailer may trade on a mercantile holiday every year, for example around a festival. It often finds double pay simpler to run. Tracking substitute days across the whole team takes more work. Some businesses close on all but one gazetted holiday a year. For them, the day-in-lieu route may be easier.
The weekly holiday worked
The weekly holiday is one whole day and one half-day (s.5). It has no equivalent 1.5x or 2x rate in the Act. The holiday must be given with full remuneration where the employee worked at least 28 hours that week, excluding overtime. The holiday itself must be taken that week or the next. Weekly holidays can be combined into a single day each month. That needs the Commissioner’s prior written sanction. The Act sets no specific premium for hours worked on the weekly holiday itself. Most employers treat those hours as ordinary overtime, paid at the standard 1.5x overtime rate. Others give a substitute day off by policy. Either approach is common. Check your own contract or handbook for which one applies. The Act leaves this choice open.
Do this automatically in Humanised
Set up a custom overtime type for Poya and mercantile holidays. Assign it to the staff who work those days, so the two rates stay separate.
Can a shop open on a holiday?
Nothing in the Act stops a shop or office trading on any of these days: Poya, mercantile, or weekly holiday. It only sets what must be paid to staff who work those days. For mercantile holidays, it also requires the Commissioner’s sanction first. A business open every day of the year needs a rota that rotates who works each holiday. It also needs a payroll process that tags each shift with the right holiday type. Poya (1.5x), mercantile (2x or lieu) and ordinary overtime (1.5x on hours beyond the normal day) are three different sums. All three can appear on the same payslip in a busy month.
Worked examples on a monthly salary
For a monthly-rated employee on LKR 90,000, the daily rate is LKR 90,000 ÷ 30 = LKR 3,000. The Shop and Office Employees Act Regulations use this same divisor to work out a daily rate from a monthly salary. See Legal Working Hours in Sri Lanka: Daily and Weekly.
| Situation | Rate required | Pay for that day |
|---|---|---|
| Works a Full Moon Poya Day, normal hours | At least 1.5× the daily rate | At least LKR 4,500 |
| Works a Gazetted mercantile holiday (sanctioned), paid rather than given a day in lieu | 2× the ordinary day rate | LKR 6,000 |
| Works 3 hours of overtime beyond the normal day, on an ordinary working day | Not less than 1.5× the hourly rate (monthly remuneration ÷ 240) | Hourly rate LKR 375; overtime LKR 1,687.50 |
| Works the weekly holiday, treated as overtime by company policy | Not less than 1.5× the hourly rate for hours worked | As above, calculated on hours actually worked |
Check any of these against the overtime calculator, which applies the same regulation.
This is general payroll guidance. Every case is different. For your own case, speak to a payroll practitioner or a lawyer.
Frequently asked questions
What if an employee works only half a day on a Poya day?
The Act sets the 1.5x rate for the day the employee is required to work. It does not set a separate half-day fraction. Most employers prorate the day rate for the actual hours worked and apply the 1.5x factor to that. Confirm this in your own policy. The Act itself is written around a full working day.
Does the 1.5x or 2x rate change for a shift that crosses midnight?
The Act defines “day”, for shift purposes, as the 24-hour period starting from when the employee’s shift normally begins (s.8). A night shift can start on the holiday and finish after midnight. It is treated as worked on the holiday for the whole shift, not split between two calendar dates.
Can an employee volunteer to work a mercantile holiday without the Commissioner’s sanction?
No. The sanction requirement in section 7 is the employer’s obligation, not something the employee’s willingness can replace. Working a mercantile holiday without prior sanction does not remove the requirement to pay the day-in-lieu or double-pay premium. It also risks separate exposure for breaching the Act.
Do part-time or shift workers get the same Poya and mercantile holiday pay?
The Act applies to anyone employed in or about the business of a shop or office. The same 1.5x and 2x rules apply, calculated on that employee’s own normal daily rate.
What happens if a Poya day and a mercantile holiday fall on the same date?
Only one holiday premium applies for the day. The Act’s Poya proviso avoids stacking a Poya entitlement on top of another holiday that already falls on the same date.
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