Farmers supplying Australia's largest dairy co-operative Norco will receive an additional 10 cents per litre for milk supplied on Christmas day.
Norco chief executive Michael Hampson said it was the first time he had heard of the 127-year old business paying the holiday bonus.
He said the company wants to thank farmers for their hard work.
"We thought what better way to recognise them on a day where the rest of the country is probably sitting back and enjoying a bit of a rest," he said.
"These guys, girls, family members are getting up still at 4.30 in the morning to get out there and milk the cows and then do it again after Christmas lunch in the afternoon."
The 10-cent bonus represents a 12 per cent increase in milk pay for the day and is expected to cost the dairy processor about $100,000.
But dairy businesses with employees working on the public holiday are required to pay penalty rates, which could impact any financial benefit from the bonus.
Nonetheless, Mr Hampson said the move was a "great gesture" and "more than just the dollar value".
"It's the fact that we're there thinking about the farmers," he said.
"And indeed for some farmers, if they're larger farmers, it's going to be a material amount of money.
He said it would be a "pretty good piece of money" for some of the smaller farmers.
"Some farms might receive $100, some farms might receive well over $1,000, it all depends on how much milk they provide us on Christmas Day," he said.
It comes on the back of a disastrous year for the processor with February's catastrophic floods destroying its ice cream factory in South Lismore.
The disaster resulted in a $27.5m loss for the financial year.
But Mr Hampson said Norco was still able to offer record milk prices this year.
"We reported a loss based on the one-off events for the floods but we also reported the second highest operating profit in the history of the co-operative," he said.
"Notwithstanding the fact that we had our ice cream factory that went down, and lost the returns from that business, two rural stores that were out of action for nearly three months and we lost our mill at Lismore."
In October Norco accepted a $34.7 million joint state-commonwealth anchor business recovery grant to rebuild its ice cream factory, in addition to $8 million in government funding to continue paying staff after the floods.
Farmers thankful for milk bonus
The bonus came as a nice surprise for Norco suppliers across northern NSW and southern Queensland who also felt the impact of the floods, as well as prolonged wet weather and rising input costs.
Tweed Valley farmer Jim Allard said it could mean a $200 boost to his milk cheque if his 90 Jersey cows delivered 2,000 litres on Christmas Day.
"I think it's great, I think all the farmers need a bit of a bonus," he said.
"We're all still struggling getting over all that wet and the floods, it's been a bit of a tough road and it's greatly appreciated.
"There are some farmers out there that will really benefit from it, a lot more than I will but everything's a bonus."
He said the extreme weather elsewhere in the state had also made it difficult to access feed for his cattle.
"All the flooding down south has made it hard for sourcing good quality feed, it's not just what happens here it's what happens elsewhere," he said.
Mr Allard acknowledged Norco's appreciation of their work with the Christmas bonus despite the co-operative being significantly hit.
"Norco's struggling, they're go to spend a lot of money too in Lismore after the floods, they've got a lot of expenses that they weren't planning on, so it's all been a battle," he said.
Call for industry-wide bonus
EastAusMilk representative Peter Graham said it was great Norco was recognising the efforts of its farmers with a Christmas day bonus.
"Maybe the other processors throughout Australia need to recognise what dairy farmers do," he said.
"I've said this for many years, we still get out of bed Christmas Day, we still milk our cows Christmas Day, Good Friday, New Years morning, and Norco have recognised that and I think that's a major step forward.
"So now it's a matter of taking it to the rest of processing sector and see what they say to that, but that sort of recognition takes it to another level and puts dairying back where it belongs."
The ABC has reached out to a number of other dairy processors on calls for an industry-wide Christmas bonus but is yet to receive any response.
