The government has closed a loophole which would have meant only people working on the substitute holiday would have been paid public holiday rates, if Christmas fell on a week day.

But people who have to work on Christmas Day would have been paid at normal rates.

Last month, the legislation was changed to make public holiday rates applicable to both the actual and substitute holidays.

The government is today expected to start an education campaign highlighting the change.

Christmas is on a Saturday this year, meaning Monday will be a substitute public holiday.

The Tasmanian Small Business Council has slammed the change.

Executive officer Robert Mallett said the extra employee wages would impact most heavily on the hospitality industry.

"You should only get paid for one public holiday at the end of the day," Mr Mallett said.

"It all comes down to profitability and productivity."

He said it may force some operators to close on the Monday after Christmas.

The change brings Tasmania into line with Queensland, New South Wales and Western Australia.

Workplace Relations Minister David O'Byrne said the new legislation would ensure that workers received fair compensation for sacrificing time with family and friends this Christmas.

"This government holds dear family values and respects the need of families to be together at Christmas time," Mr O'Bryne said in Parliament.

"If this cannot happen, then some degree of penalty rates for workers on Christmas Day is justified."

Last month, the state's upper house rejected a proposed change to provide a substitute public holiday for Anzac Day which falls on a Saturday next year.