Would be happy to stand corrected but here is my understanding. Though couldn't find enough documentation on this, running EMS program verifies these findings.

The logic below is true when either Use Weather File Holidays and Special Days in RunPeriod is set to No or when Use Weather File Holidays and Special Days in RunPeriod is set to Yes but EPW file doesn't have any holidays. That is, EPW has HOLIDAYS/DAYLIGHT SAVINGS,No,0,0,0

    If (simulation day != holiday) then
        Holiday = 0;
    else If (simulation day == holiday) then
        Holiday = 1;
        !  specified using RunPeriodControl:SpecialDays as follows
        !  RunPeriodControl:SpecialDays,
        !    New Years Day,           !- Name
        !    January 1,               !- Start Date
        !    1,                       !- Duration {days}
        !    Holiday;                 !- Special Day Type 

        ! (Christmas, New year, Thanksgiving, MLK/Labor/Memorial Day etc have Holiday value of 1)
    elseIf (simulation day == WinterDesignDay && DayType ==  WinterDesignDay) then
        Holiday = 3;
        ! SizingPeriod:DesignDay has input field DayType
    elseIf (simulation day == WinterDesignDay && DayType ==  Holiday) then
        Holiday = 1;
    elseIf (simulation day == SummerDesignDay && DayType ==  SummerDesignDay) then
        Holiday = 2;
    elseIf (simulation day == SummerDesignDay && DayType ==  Holiday) then
        Holiday = 1;
    endif