Where does the law currently stand with regards to official government observances of the Christian holy days of Good Friday and Easter? What are governments allowed and not allowed to do? What are schools allowed to do and what rights to students have? It's helpful to know the answers to these questions as well as what the case law is because you might confront constitutionally suspect actions by local school boards, school administrations, and city councils.
What's Constitutional for Local Governments
State and local governments can observe Good Friday by closing offices and giving employees a paid holiday, even if they do not do so for any other religion. The government must, however, be able to point to a legitimate secular purpose in doing so; if no such purpose exists, then the courts will likely conclude that Good Friday was chosen as a public holiday in order to support or endorse Christianity (Bridenbaugh v. O'Bannon, 1993 and Granzeier v. Middleton, 1999).
State and local governments must also allow private citizens to participate in religious celebrations in public forums — in other words, on public streets and in the "town square," provided that the regulations and restrictions imposed are the same for all who use those sites and that the restrictions are content-neutral. Private citizens can erect Easter displays and sponsor Easter dramas if they wish; their presence is not construed as an indirect government endorsement of the contents of the messages being communicated (i.e., there is no government endorsement of the religious messages).
What's Constitutional for Public Schools
In schools, teachers are permitted to mention the religious nature of the days and explain what their backgrounds are. They can even read from the Bible as part of doing this; however, teachers must take care not to cross the line dividing explanation from advocacy. Because reading from the Bible might make crossing that line easier without noticing, doing so might not be a wise choice unless it occurs as part of a program which has been studied and reviewed ahead of time for possible problems. It would be unconstitutional to appear to be promoting Christianity to students who may not be Christian, so caution, care, and consideration are called for here.
Such a program may also include holiday-themed music and even holiday-themed dramas (Florey v. Sioux Falls, 1980). However, the most obvious type of drama would be one depicting the arrest, trial, crucifixion, and resurrection of Jesus Christ. It could be very difficult to effectively argue that such a dramatization of the events depicted in the New Testament qualify only as education rather than advocacy.
Schools also have the authority to close on Good Friday and even the Monday immediately after Easter Sunday, if they wish. To do so, however, they must be able to articulate a secular purpose — for example, arguing that so many students would be absent that it makes no sense to remain open (Metzl v. Leininger, 1995 and Koenick v. Felton, 1999). Not all courts have demanded evidence of such a state of affairs, but it would probably be wise to have that evidence if this argument is offered. Why make the claim, especially in court, if you have no idea if it is true or not?
It would also help the argument if the schools can point to a policy of accommodating the holy days of various other religions followed by students. If no such policy exists, then it will be apparent that the school is only interested in accommodating Christianity, a situation which would violate the second prong of the Lemon Test. When government action serves to inhibit or advance any particular religion, it is unconstitutional.
Finally, students in schools have a right to celebrate Good Friday or any of the other Christian holy days as part of their participation in Bible, prayer, or other religious clubs they have formed (provided that the school permits other clubs to use school facilities). Because the speech and actions of the students involved are private, it is not unconstitutional for them to do something to celebrate one of their holy days.
Although making Christian holy days like Good Friday an official government holiday is a practice often accepted as a matter of course in the past, recently more and more people have begun to object to what they perceive as unfair favoritism being shown towards Christianity and Christian beliefs. Because of this, they are challenging the practice of accommodating Christian beliefs in ways not generally accepted for the beliefs of other religions — but with mixed results.
Bridenbaugh v. O'Bannon (1993)
According to the Seventh Circuit Court of Appeals, a government is permitted to give employees a religious holiday off as a paid vacation day, but only if the government can provide a legitimate secular purpose for choosing that day instead of any other day.
Metzl v. Leininger (1995)
According to the Seventh Circuit Court of Appeals, Illinois' policy of making Good Friday a school holiday when schools would be closed but teacher paid anyway was unconstitutional because there was no larger secular purpose involved and, hence, the holiday amounted to favoritism towards one religion over others.
Koenick v. Felton (1999)
According to the Fourth Circuit Court of Appeals, schools can close for Good Friday and Easter because such closings serve the secular purpose of saving money when many students would not be around anyway.
Granzeier v. Middleton (1999)
According to the Sixth Circuit Court of Appeals, government offices can close for Good Friday and Easter so long as they have a legitimate secular purpose, for example a desire to accommodate the travel plans of employees.