Is it permissible for a Muslim manager to allow a non-Muslim employee to take leave to celebrate their holiday?

The holidays of the disbelievers are innovated and invalid, especially if they are religious. It is forbidden to congratulate them on them, participate in them, or assist in them. Ibn Taymiyyah narrated from Ibn Habib al-Maliki the prohibition of Muslims selling anything related to the Christians' holiday to them or assisting them in it, because that is considered glorifying their polytheism.

As for allowing the disbelieving worker to take his regular vacation according to labor laws, there is no harm in it, even if it coincides with the time of his holiday, because he has a right to vacation like other employees, and he can dispose of it as he wishes. However, what is forbidden is granting him leave specifically for his holiday if he is not entitled to it by the original terms of his contract and employment, as that constitutes aiding in wrongdoing. Allah Almighty says: (And cooperate in righteousness and piety, but do not cooperate in sin and aggression. And fear Allah; indeed, Allah is severe in penalty) Al-Ma'idah/2.