A business day is generally understood as a specific workday when most commercial and financial institutions are operational, aligning with the standard work week. This designation is important for calculating deadlines, interest accruals, and transaction processing times. In the United States, Saturday is generally not counted as a business day. The standard expectation for time-sensitive commercial matters is that a business week runs consistently from Monday through Friday.
Defining the Standard Business Day
The widely accepted definition of a business day establishes the period as Monday through Friday, encompassing the five standard working days of the week. This timeframe aligns with the customary operating hours of banks, major corporations, and financial markets across the United States, providing predictability for commerce. This five-day standard provides a consistent framework for commercial agreements and regulatory compliance.
This standard definition consistently excludes all weekends (Saturday and Sunday) and any day designated as a federal holiday. Even if a federal holiday occurs on a typical workday, it is not considered a day where standard business operations occur for the purpose of calculating time-sensitive matters.
Why Saturday is Typically Excluded
The exclusion of Saturday stems from the historical evolution of the modern work week and the structure of financial systems. The five-day work week became the norm for many industries in the mid-20th century, establishing Saturday as a day of rest or non-operation for a significant portion of the workforce and for major transactional activities.
This practice is reinforced by the operating schedules of major financial institutions and the Federal Reserve System. Core banking and payment processing systems, such as the Fedwire Funds Service and the Automated Clearing House (ACH) network, do not operate on Saturday. This centralized closure prevents Saturday from functioning as a standard day for settlement and interbank transfers, effectively removing it from the business day equation for most high-level commerce.
Contractual and Legal Definitions
While the Monday-through-Friday standard prevails, parties engaging in a commercial agreement can legally define “business day” to suit their specific needs. Contracts and formal agreements often include a dedicated definitions section that supersedes the general understanding for the specific transaction. If a contract explicitly states that a business day includes Saturday, then for the purpose of that agreement, Saturday must be counted.
Reviewing this definitional language is important before agreeing to any deadline or performance obligation stipulated in a document. A contract might define a business day as any day an office is open for regular business, which could include Saturday hours for a specialized retail or service provider. Without this explicit definition, however, a court or regulatory body will typically default to the standard Monday-through-Friday exclusion when interpreting time requirements.
Industry-Specific Interpretations
The application of the business day definition varies significantly depending on the industry and the specific regulations governing its operations.
Banking and Financial Services
Within the banking sector, the term “banking day” is often used, generally aligning with the standard Monday through Friday schedule. Regulation CC, which governs check processing and funds availability, defines a banking day as any day a bank is open to the public for substantially all of its functions. Although many banks have lobby hours on Saturday, this day is usually excluded from the banking day count for regulatory processing requirements, such as clearing large deposits. Since the Federal Reserve’s payment systems are closed on weekends, Saturday cannot be a processing day for many regulated financial activities.
Shipping and Delivery Logistics
Shipping and logistics companies often operate seven days a week, but this does not automatically make Saturday a business day for transit time calculations. Carriers like FedEx, UPS, and the United States Postal Service (USPS) routinely offer Saturday delivery and pickup services. However, their service agreements often define a “business day” as Monday through Friday when calculating estimated transit time. If a fulfillment deadline is based on “business days,” a package shipped on Friday might not start its transit clock until Monday, even if it moves through the network over the weekend.
Government and Regulatory Deadlines
Government agencies, courts, and regulatory bodies adhere to strict definitions for filing deadlines. The Internal Revenue Service (IRS) and state courts generally follow the Monday-through-Friday definition, excluding all federal holidays. When a statutory or regulatory deadline falls on a Saturday, Sunday, or legal holiday, the “next business day” rule typically applies. This rule dictates that the deadline is automatically extended to the next subsequent day that is not a weekend or a holiday. This ensures that parties have a full day during standard operating hours to complete their submission.
The Role of Federal Holidays
Federal holidays represent the other significant category of non-business days that impact deadline calculations. Even if a day falls within the Monday-to-Friday window, its designation as a legal federal holiday means it is not counted as a business day for most commercial purposes. This applies to days like Christmas Day, Thanksgiving, and Juneteenth, regardless of which day of the week they occur.
This exclusion is universally applied across banking, government, and most corporate environments. It is important to distinguish federal holidays from state or local holidays, which typically do not affect the definition of a business day unless specified in a private contract. The official list of holidays observed by the Federal Reserve System serves as the practical standard for determining these non-business days.
Calculating Deadlines Using Business Days
Accurately counting business days requires applying standard exclusions to a calendar, often starting the count the day after a triggering event. For example, to calculate a seven-business-day deadline starting on a Tuesday, the count begins on Wednesday, tallying the following seven weekdays.
The calculation must skip all Saturdays, Sundays, and recognized federal holidays within that period. If the countdown includes a Monday that is a federal holiday, the count skips from the preceding Friday directly to the subsequent Tuesday. If the final business day falls on a non-business day, such as a Saturday, the deadline is automatically pushed to the following Monday, assuming that Monday is not also a federal holiday.