Variation 1: Spell "L-A-B-O-R" then sign DAY.
Labor Day: Variation 2:
In context you can sign "WORK DAY." This is only appropriate if the context is obvious. You can't just walk up to someone and sign "WHAT-DOING WORK DAY" and expect them to know what it means. Suppose you were teaching a group of kids about "holidays" and it was obvious you are talking about the particular holiday known as "Labor Day" then you could sign "WORK DAY" and it would make sense.
See also: WORK
American Sign Language University ™ ASL resources by Lifeprint.com © Dr. William Vicars