Dear friend,
Let me add to what Mr Umakanthan M has said.
In the government sector, there are two types of holidays, closed and restricted. On the closed holidays the offices remain closed except for emergency staff. In contrast, on restricted holidays, the offices remained opened. However, whether to avail of this holiday or not is individual employee's call. The benefit of restricted holiday is that it maintains the continuity of the work and unlike closed holidays, the entire office is not closed.
At the beginning of the calendar years, government offices the list of closed and restricted holidays. However, most of the time, the closed holidays are declared depending on the regional and local requirements. Now take the case of Punjab. State or Central government may not give closed holiday on Ugadi which is celebrated on wider scale in south India. But what about a south Indian working in Punjab? The employee may take restricted holiday and celebrate the Ugadi.
I don't know whether any change has taken place but earlier those who worked in central government services were authorised to take two restricted holidays. While availing of the restricted holidays, employee need not be from that cast, creed, religion etc. for which the restricted holiday is declared.
As far as the private enterprises is concerned, most of the state governments in India have exclusive act about state and national holidays. However, this list may not have provision of the resticted holidays. Employers are given freedom to decide the declaration of holidays except for national holidays like Republic Day.
In the last 20-25 years, in the post-liberalisation era, lot of inter-state movement has happened. Therefore, to allow the employees who are not from that state to celebrate the holidays as per their culture, few big companies and MNCs have introduced the concept of restricted holidays in their company. In few companies, term "Floating Holiday" is used instead of restricted holiday.
Concept of restricted holiday is purely initiative of the employer and there are no provision related to this in either shops and establishment act factories act. It can be considered as welfare measure also.
Thanks,
Dinesh Divekar