Vacation Pay in California

Over the past several years, California labor law attorneys have struggled, through the courts, to come to terms with the vagaries of California vacation pay and related payment rules. Employers in California have come up with elaborate vacation plans which in some cases have been judged to be illegal under California labor law.

Is California Vacation Pay Required?

According to California vacation pay rules, if a California vacation plan is specifically offered under an employer's policies, it must  be enforced and administered.  In general, however, it is not mandatory for employers to furnish their employees with California vacation pay.

When do Employees Lose Their Rights to Their California Vacation Pay?

In short, the answer is - rarely. Per Suastez v. Plastic Dress Up (1982) 31 Cal.3rd 774, a governing case in this area of California labor law, California employers are forbidden from implementing a "use it or lose it" California vacation policy that requires employees to forfeit accrued vacation time. California vacation pay law mandates that, upon separation from employment, any non-utilized California vacation pay must be remitted according to the employer' vacation pay rules.

On the other hand, per Boothby v. Atlas Mechanical (1992) 6 Cal. App 4th 1595, employers are allowed to institute a reasonable cap on further accrual of California vacation pay benefits. As an example; your employer is not permitted to demand that you use all of your 18 days of accrued California vacation time before the end of the year or suffer a reduction in your "bank" of vacation time to 7 days at the start of the new year. However, your employer may demand that you follow a rule that that states that if you have 18 days of accrued California vacation time, you may not continue to accrue any additional time until some of your current vacation days are used.

In summation, when an employee is separated from employment, pursuant to California Labor Code §§ 201, 202, 227, 227.3, all accrued but unused and unpaid California vacation benefits must be paid. If you believe that your employer has violated vacation pay policies by denying you California vacation pay, our California labor lawyers are standing by to evaluate your possible claim.

San Francisco ERISA Attorneys

Many employers in California may try to skirt the more restrictive California vacation law by trying to establish a funded plan under the federal ERISA (Employee Retirement Income Security Act) law. However, many of these plans are not in compliance with the stringent requirements of ERISA and, therefore, directly violate California vacation pay laws. If you are in doubt as to whether or not your plan is in compliance with state vacation law, it would be prudent to contact an seasoned San Francisco  ERISA  attorney who will be able to determine if your employer is in compliance in the state of California.

If you believe that your employer has a California vacation pay policy that violates California labor law, or if you believe that your employer is illegally denying you your vacation pay compensation, our California labor law attorneys have a wealth of experience in evaluating California vacation plans and related claims, so please contact us for a thorough review of your claim at no cost. We at United Employees Law Group are devoted to standing up for and protecting California employees with vacation pay claims against employers who do not comply with California state labor law.

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