National Holiday Allowance

The National Holiday Allowance is a per-day payment for non-gazetted staff required to work on Republic Day, Independence Day or Gandhi Jayanti.

Updated 18 July 2026 · Reviewed by Salary-Calculator.in

The National Holiday Allowance is a per-day allowance paid to a non-gazetted central government employee who is required to work on one of the three national holidays, Republic Day, Independence Day or Gandhi Jayanti, when the office or establishment is otherwise closed. It compensates the employee for losing a national holiday to duty, and it is a flat amount by pay level for each such holiday actually worked, rather than a payment by the hour. Its largest body of recipients is on the railways, where the trains cannot stop for a holiday, but it reaches every essential establishment that must keep working on those three days.

The allowance belongs to the family of payments for working outside normal conditions, alongside the overtime allowance for extra hours and the night duty allowance for work at night, but it answers a different thing from either. Overtime and night duty are keyed to hours; the National Holiday Allowance is keyed to the day itself, to the fact that the employee spent a national holiday on duty while the rest of the government was closed. That is why it is a flat per-day figure and not a rate per hour.

This article explains what the allowance compensates, the three national holidays it is tied to and how they differ from the rest of the holiday list, who is eligible and the pay-level slabs, the per-day rate under the 7th Central Pay Commission and the dearness-allowance enhancement, how the amount is worked out and for how many days, where the allowance sits among the duty-pattern allowances, the railway context that dominates it, and the tax position. It is a child of the allowances hub.

What the allowance compensates

The working assumption behind the government’s holiday calendar is that on a closed holiday the office shuts and the employee is free. The three national holidays are the firmest form of that assumption: they are compulsory closed holidays on which, as far as possible, no government office functions. But some services cannot stop. Trains have to run, essential establishments have to be staffed, and the security, health and operational machinery of the state has to keep working on Republic Day, Independence Day and Gandhi Jayanti as on any other day. The employees who keep those services going lose the national holiday that everyone else enjoys.

The National Holiday Allowance is the recognition of that loss. It is not a reward for productivity and not a reimbursement of a cost; it is a compensatory payment for being required to attend on a day that the rules otherwise guarantee as a holiday. Because the thing being compensated is the loss of the whole holiday, the allowance is a flat amount for the day rather than a rate that climbs with the hours, and an employee who works a national holiday draws the same allowance whether the shift is short or long.

That framing also explains the allowance’s limits. It is confined to the three national holidays, not extended to the many gazetted holidays, because the national holidays carry a special status as compulsory closed days. And it is confined to non-gazetted staff, because the scheme was built for the operational and essential-service workforce who are rostered onto holiday duty, not for gazetted officers whose conditions of service are dealt with differently.

The three national holidays

There are exactly three national holidays in the central government calendar, and they are the constitutional and historical landmarks of the nation:

Republic Day, 26 January, marking the coming into force of the Constitution in 1950.
Independence Day, 15 August, marking independence in 1947.
Gandhi Jayanti, 2 October, the birth anniversary of Mahatma Gandhi.

These three stand apart from the rest of the holiday list. A central government employee’s annual holidays are made up of a set of compulsory closed holidays and a set of restricted holidays from which the employee chooses a limited number, and the full list is notified each year; the reference article on central government holidays covers how that list is built. Within it, the three national holidays are the ones on which offices are closed without exception and on which no substitution or restricted-holiday choice applies. They are also the days on which the display of the national flag and official observances take place, which is part of why their closed status is treated as absolute.

The National Holiday Allowance attaches only to these three. Work on an ordinary gazetted holiday, a Sunday or a second Saturday is dealt with by the leave and compensatory-rest rules and, where hours run long, by the overtime rules, not by this allowance. It is the special status of the national holiday, a day the state itself marks and closes, that the allowance is built around.

Who draws it

The allowance is for non-gazetted staff who are required to attend for duty on a national holiday because their service cannot be suspended. In practice that means the operational and essential-service workforce, and by a wide margin the largest group is on the railways. A train timetable does not pause for Republic Day, so running staff , station staff, signalling and controlling staff and the rest of the operating machinery are rostered across the national holidays, and they are the core recipients of the allowance. Beyond the railways it covers other essential establishments, hospitals and emergency services, security and operational units, and any office that must keep a skeleton or full strength working on those days.

The eligibility is drawn along two lines. First, the employee must be non-gazetted; gazetted officers are outside the scheme. Second, the employee must actually be required to work the holiday under a roster or order, not merely be willing to; the allowance follows the duty, not the availability. An employee who is not rostered for a national holiday, and who therefore keeps it as a holiday, does not draw the allowance, because there is no lost holiday to compensate.

The scheme is, in short, targeted at the part of the workforce that carries the burden of keeping essential services running on the days the rest of the government is closed. That is why it is concentrated in the operating grades and why the railways, as the largest operational department, account for most of it.

Eligibility at the edges

A few situations are worth setting out, because they mark the boundary of the entitlement. An employee who is on leave on a national holiday does not draw the allowance for that day, because the allowance is for working the holiday, and an employee on leave has not worked it; the day is simply covered by the leave. Equally, an employee who is off under the normal roster on a national holiday, so that the holiday falls on a scheduled rest day rather than a working day, is treated under the roster and rest rules rather than paid the allowance, because the allowance answers a holiday given up to duty.

The gazetted-versus-non-gazetted line is the firm one. Gazetted officers are outside the scheme even when they attend on a national holiday, because their conditions of service are dealt with differently; the National Holiday Allowance was designed for the non-gazetted operational and essential-service workforce. Casual, contract and outsourced workers are outside the scheme too, since the allowance is a service benefit attached to a regular non-gazetted post, not a payment to every person who happens to be on the premises on the day.

The common thread across these edges is that the allowance follows a rostered requirement to work a national holiday in a regular non-gazetted post. Where that requirement is present, the allowance is due; where the day is covered by leave, by a scheduled rest day, or by a status outside the regular non-gazetted workforce, it is not. This keeps the allowance matched to the specific burden it was created to recognise.

The pay-level slabs and the rate

The National Holiday Allowance is a per-day amount set in slabs by pay level, so that it rises in a few steps with the employee’s pay level rather than being a single flat figure for everyone or a percentage of pay. The 7th Central Pay Commission revised the rates upward from the 6th CPC figures and set them as follows:

Pay level	7th CPC rate (Rs. per day)	Enhanced rate since 1 January 2024 (Rs. per day)
Levels 1 and 2	384	about 480
Levels 3, 4 and 5	477	about 596
Level 6 and above (eligible non-gazetted)	630	about 788

The rate is a flat amount for the day. It does not climb with the hours worked, because the allowance compensates the loss of the holiday and not the length of the shift, and it does not depend on the exact basic pay within a level, because the slab is set by the level band rather than by the individual pay. Two employees in the same band who both work a national holiday draw the same amount.

As a fixed-rupee allowance under the 7th CPC, the National Holiday Allowance is of the kind that rises by 25 per cent each time dearness allowance rises by 50 per cent, the standard escalator that keeps rupee-denominated allowances from falling behind prices. Dearness allowance reached 50 per cent with effect from 1 January 2024, which triggered the first such rise, so from that date the base rates of Rs. 384, Rs. 477 and Rs. 630 stand about a quarter higher, of the order of Rs. 480, Rs. 596 and Rs. 788 a day. The next 25 per cent step does not arrive until dearness allowance reaches 100 per cent, because the escalator moves in whole 50-point blocks.

How the amount is worked out

The calculation is simple, which is part of the point of a flat per-day allowance. For each national holiday the employee is required to work, they draw the per-day amount for their pay level. Because there are three national holidays in a year, the allowance can be drawn for up to three days in a calendar year, and the total for the year is just the per-day rate multiplied by the number of national holidays actually worked.

So an employee in Levels 3 to 5, rostered for duty on Independence Day and Gandhi Jayanti but not Republic Day, draws the per-day rate twice; one rostered for all three draws it three times; one not rostered for any draws nothing, because they kept the holidays. There is no pro-rating for part of a day and no enhancement for a long shift, because the unit of the allowance is the holiday, not the hour. This is a deliberate contrast with the hour-based allowances, and it keeps the National Holiday Allowance easy to administer across a large operational workforce.

A worked illustration

A few figures make the scale of the allowance concrete, using the enhanced rates since 1 January 2024. Take three employees, each rostered for all three national holidays in a year.

An employee in Level 1 or 2, a multi-tasking or entry operating grade, draws about Rs. 480 a day, so three national holidays are worth about Rs. 1,440 in the year.
An employee in Levels 3 to 5, a typical operating grade, draws about Rs. 596 a day, so three national holidays are worth about Rs. 1,788 in the year.
An employee in Level 6 or above among the eligible non-gazetted grades draws about Rs. 788 a day, so three national holidays are worth about Rs. 2,364 in the year.

These are the maximums, for an employee rostered on all three national holidays; an employee rostered on one or two draws the rate for that many days. The figures show two things. First, the allowance is a real but modest addition, tens of hundreds of rupees in a year rather than a major component of pay, which fits its purpose as a compensation for a specific loss rather than a second income. Second, the slabbing by pay level keeps the compensation broadly proportionate, so that a more senior operating employee, whose day is worth more, is compensated a little more for giving it up. The amounts move up together whenever the dearness-allowance escalator lifts the per-day rates by another 25 per cent.

How it is disbursed

The National Holiday Allowance is paid through the salary rather than in cash on the day, and it is claimed and passed on the basis of the duty roster and the attendance record that show the employee worked the national holiday. In a large operational department such as the railways, where thousands of employees across a division may be on holiday duty, the claim is a routine part of the establishment’s monthly processing, drawn from the roster rather than from an individual application in most cases.

Because it is settled through the salary, the allowance for a national holiday usually appears in the pay for the month in which the holiday fell or shortly after, once the attendance is confirmed. It is shown as a distinct line, the National Holiday Allowance, and not merged into basic pay or into the hour-based allowances, so an employee can see exactly what was paid for the holiday worked. Where a claim is delayed or an attendance record is corrected, the allowance can be paid as an arrear in a later month, but the amount is the per-day rate for the pay level at the time, applied to the national holidays actually worked.

Where it sits among the duty-pattern allowances

It helps to place the allowance against its neighbours in the family of payments for working outside normal conditions, because the three are easy to run together and each answers a distinct thing:

The National Holiday Allowance compensates working on a national holiday, as a flat per-day amount by pay level.
The overtime allowance compensates hours worked beyond the normal working day, as a rate keyed to hours; it was largely abolished for civilian staff in 2017 but retained for certain operational and statutory-industrial categories.
The night duty allowance compensates hours worked at night, again keyed to hours and to pay.
The split duty allowance compensates a working day broken into two spells with a long gap, as a flat monthly amount.

The dividing line is what each one measures. The National Holiday Allowance measures the day; the overtime and night-duty allowances measure the hours; the split-duty allowance measures the pattern of the day. An operating employee on the railways could, over a year, encounter more than one of these, drawing the National Holiday Allowance for a national holiday worked, the overtime or night-duty allowance for hours or nights on other days, and so on, because each compensates a different feature of the work. They are separate entitlements with separate rules and are not alternatives to one another.

Overtime, compensatory rest and the same day

A common question is whether an employee who works a national holiday can also draw overtime, or a compensatory day off, for the same day. The answer is that the National Holiday Allowance and any overtime or compensatory-rest entitlement are governed by separate rules, and the treatment depends on the service and the department. The allowance compensates the fact of working the holiday; whether the same day also attracts overtime for hours beyond the normal shift, or a compensatory rest day in lieu, is a matter for the overtime and rest rules of the establishment, and those rules decide how the two interact.

What is clear is that the National Holiday Allowance is not itself an overtime payment and is not a substitute for compensatory rest. It is the payment for the holiday having been worked at all. Where an establishment grants both the allowance and a compensatory off, or the allowance and overtime for the extra hours, it does so under its own rules; the allowance in this article is the fixed per-day amount, and the other entitlements are separate questions handled elsewhere.

The railway context

Because the railways are the single largest operational department, they dominate the National Holiday Allowance, and it is worth seeing the allowance through that lens. The railway workforce that keeps trains running, loco pilots and other running staff, guards, station masters and station staff, signalling and controlling staff, is rostered around the clock and around the calendar, national holidays included. For these employees the national holidays are ordinary working days in operational terms, and the allowance is the recognition that they are on duty on days the rest of the government is closed.

The railway employees article covers the wider structure of railway pay, of which this allowance is one operational element alongside the running allowance for running staff and the other railway-specific payments. The point to carry from here is that the National Holiday Allowance, though it applies across the essential-service workforce generally, is in practice most visible on the railways, and the railway operating grades are where most of it is drawn.

The tax position

The National Holiday Allowance is part of salary income and is taxable in the ordinary way. There is no specific exemption for it: the Section 10(14) exemptions under Rule 2BB of the Income-tax Rules are for defined categories of allowance, chiefly the field, travel and area allowances, and a holiday-working allowance does not fall within them. It is therefore taxable under both the old and the new tax regimes, and the default new regime under Section 115BAC in any case withdraws the great majority of the Section 10(14) exemptions.

The amounts involved are modest, at most the per-day rate for three days in a year, so the tax effect is small, but the allowance is counted in gross salary for the year. For how the allowances feed into the salary computation and the choice of regime, see income tax for government employees and old versus new tax regime .

The 8th CPC outlook

The National Holiday Allowance was retained and revised by the 7th Central Pay Commission and has risen once since, by the 25 per cent enhancement from 1 January 2024. It answers a need that will not go away, because essential services will always have to run on the national holidays, so the allowance itself is likely to continue in some form. Whether the 8th Central Pay Commission revises the per-day slabs, restructures them by pay level, or changes the escalation is not known, and no post-8th-CPC figure can be stated as fact until that commission reports and its recommendations are accepted. Until then the position is the per-day slab by pay level, at the enhanced rates since 1 January 2024, for each of the three national holidays a non-gazetted employee is required to work.

Frequently Asked Questions (FAQs)

What is the National Holiday Allowance?

It is a per-day allowance paid to a non-gazetted central government employee who is required to work on one of the three national holidays, Republic Day, Independence Day or Gandhi Jayanti, when the office or establishment is otherwise closed. It compensates the employee for losing a national holiday to duty, and it is a flat amount by pay level for each such holiday actually worked, not a payment by the hour.

Which are the three national holidays?

Republic Day on 26 January, Independence Day on 15 August, and Gandhi Jayanti on 2 October. These three are compulsory closed holidays across central government offices, distinct from the gazetted and restricted holidays that make up the rest of the annual holiday list. The National Holiday Allowance is tied specifically to work on these three days.

How much is the National Holiday Allowance?

The 7th Central Pay Commission set it as a per-day slab by pay level: Rs. 384 a day for Levels 1 and 2, Rs. 477 for Levels 3 to 5, and Rs. 630 for Level 6 and above among eligible staff. As a fixed-rupee allowance it rises by 25 per cent each time dearness allowance rises by 50 per cent, so since 1 January 2024 the rates stand about a quarter higher, of the order of Rs. 480, Rs. 596 and Rs. 788 a day.

Who is eligible for the National Holiday Allowance?

It is drawn by non-gazetted staff, mainly Group C operational and essential-service employees, who are required to attend for duty on a national holiday because their service cannot stop. The largest body of recipients is on the railways, where running, station and signalling staff keep trains moving on the national holidays, but it also covers other essential establishments that must function on those days. Gazetted officers do not draw it.

How many national holidays does it cover?

There are three national holidays in a year, and the allowance is paid for each one actually worked, so an employee can draw it for up to three national holidays in a calendar year. It is paid per holiday on duty, so an employee rostered for two of the three draws it twice, and one rostered for all three draws it three times.

Is the National Holiday Allowance the same as overtime?

No. Overtime allowance pays for hours worked beyond the normal working day, and the night duty allowance pays for hours worked at night; both are keyed to hours. The National Holiday Allowance is a flat per-day amount for working on a national holiday at all, whatever the hours, because it compensates the loss of the holiday rather than extra time. The rules on whether an employee also gets compensatory rest or another payment for the same day depend on the service and are separate from the allowance itself.

Is the National Holiday Allowance taxable?

Yes. It is taxable as part of salary income, and there is no specific exemption for it: the Section 10(14) exemptions under Rule 2BB are for defined field, travel and duty allowances and do not cover a holiday-working allowance. It is therefore counted in gross salary under both the old and the new tax regimes.

External references

References

Report of the Seventh Central Pay Commission (November 2015), Chapter 8 (Allowances): review and revision of the National Holiday Allowance.
Ministry of Finance, Department of Expenditure, Resolution No. 11-1/2016-IC dated 6 July 2017: Government decision on the 7th CPC allowances, retaining the National Holiday Allowance at the revised per-day slabs, subject to the 25 per cent increase when dearness allowance rises by 50 per cent.
Department of Expenditure and Ministry of Railways orders on the National Holiday Allowance (per-day rates by pay level, eligibility of non-gazetted staff, and the three national holidays covered).
Ministry of Finance, Department of Expenditure, Office Memorandum No. 1/1/2024-E.II(B): dearness allowance revised to 50 per cent with effect from 1 January 2024, triggering the 25 per cent rise in the fixed-rupee allowances.
Income-tax Act 1961, Section 10(14) read with Rule 2BB of the Income-tax Rules, and Section 115BAC (the new tax regime), on the taxability of allowances outside the notified exemptions.