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Claim 25% offA federal holiday means the holidays granted by the federal government, i.e., ten paid holidays every year. During this time, non-essential government agencies are not operational. The employees have a day off and get paid for that day. Not just government agencies are closed, but also the schools, banks, and post offices are not open. The private companies also prefer to grant the federal holidays to their employees, but they are not compelled to do so legally.