Payment Status 

The vacation time/paid time off cannot expire and has to be compensated to the employee. An employer does not have to give all employees equal vacation time/paid time off (VT/PTO) but they should not discriminate against employees due to their race, gender, or other protected statuses. An employer should also not discriminate against an employee because they reiterated that they were entitled to their VT/PTO. They will be liable for discrimination.

Contract Termination 

If the employee’s contract is terminated, they are still entitled to their paid time off and/or vacation time. VT/PTO Is viewed as wages and so is earned as work is performed.

California law recognizes floating holidays and personal days which are not counted in the employee’s VT/PTO if they separate. An employee may receive VT/PTO on public holidays or their birthday depending on company policy. However, they may not demand compensation for it upon termination of their contract.

VT/PTO can be given in advance but cannot be deducted from an employee’s income if for some reason an employee leaves before working for the set number of days. An employer can be required to pay a waiting time penalty for delaying in VT/PTO compensation. Currently, the time penalty varies but is up to an employee’s wages for 30 days of work.

Limits to Earned Vacation Time and Paid Time Off 

I.) An employee has the power to limit the number of hours of vacation time an employee earns over a period of time. There is no definition on what the cap should be only that it should be “reasonable.”

II.) An employee can set a limit to the amount of VT/PTO an employee earns before demanding payment. An employee can be required to receive a certain number of days before earning more VT/PTO.

III.) An employer can base their PTO and Vacation time compensation based on the employee’s status offering full-time employees compensation and part-time employees none.

IV.) An employer can decide when an employee takes their vacation time and can even make special dates when an employee should not take a vacation.

V.) Although PTO/VT is not protected by California’s Rules on Paid Time Off/Vacation Time, employees are entitled to paid sick leave by the Healthy Families Act of 2016.

Frequently Asked Questions 

1.) How Can I receive my VT/PTO if my employer is refusing to compensate me for work done?

You could file a lawsuit against your employer or a complaint with the Labor Commissioner’s Office

2.) My employer refused to give me paid time off over Christmas. Can I demand compensation?

It depends on the contract that you signed upon employment. If it states that you are entitled to PTO over Christmas or other public holidays then you can demand compensation.

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The Californian law does not dictate that vacations are mandatory. Due to the importance these have on the employee morale and subsequently the business returns however makes it an ideal option for many employers. A holiday allows the employee some time off work so that he or she can relax and come back with renewed energy. When an employer decides to allow vacations there are some rules that they must follow.

Vacation duration

This is solely determined by the employer and can range from a few days to a month as they may deem fit. This decision however should not be biased depending on factors such as gender, religion and sex. Other than how long the vacation can last, the employer also determines when these vacations cannot be taken. These will usually be periods when the business is at its peak. The maximum number of employees that can be on vacation at any given time is also determined by the employer.

Who qualifies to have vacations? This is also at the discretion of the employer. Not everyone in the company may be allowed a vacation. Some will allow only the managers while others will allow only the permanent employees and others allow all employees to have this privilege. So long as there is no biasness based on personal traits like race then it is legal.

Sick leaves

Under the Californian law, an employer must provide a minimum number of paid sick days in a year for all its employees.

Accrual

While some employees will be glad to go on vacation, others prefer to work all year round. The latter can gain from vacation accrual law which states that from when an employer deems it fit for the employee to have paid vacations, the dues accrue. The days also accrue and you can go on a longer vacation in the next. In California, accrued vacation is considered as unpaid wages if not used. This wage continues to accrue unless there is a cap set on the vacation accrual. The law permits employers to place a reasonable cap, that is, a period after which the accrual stops. There is no actual set value but 1.5times the annual accrual rate is acceptable.

Employers can advance vacations to their employees is they deem it necessary.

Payout

Accrued vacation must be paid to the employee when he or she loses the job be it through being fired or quitting. It is part of the wages the employee has earned at the company and needs to be paid in the final wage. Advanced vacations however may not be deducted from the employee’s final cheque.

On the other hand sick days do not need to be paid off upon separation unless they are included in a general PTO policy.

All payout needs to be paid on separation as per the law or a waiting charge of daily wage for up to 30 days will apply.

Paid time off

This may come on any day of the year or on special days like birthdays, Christmas and anniversaries (known as floating holidays). When on a special occasion these are not considered as vacations but for the prior they are and need to be paid out upon separation.

Photo Credit: Shutterstock/sirtravelalot

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