Now that the summer is in full swing, vacation is a topic that is near and dear to all of us. Unfortunately for some, an employer in California is not legally required to provide its employees with either paid or unpaid vacation time. Fortunately, many employers do provide paid vacation benefits to their employees. Once an employer establishes a policy or practice of providing paid vacation benefits, there are various safeguards in place under California law to preserve and protect this precious resource.
Earned vacation is considered to be a form of wages, which is earned as labor is performed. As a result, the employee’s entitlement to vacation benefits begins to accrue immediately, as long as the employee has completed any probationary period established by the employer. While vacation time accrues as it is earned, there is no similar forfeiture requirement. In fact, earned vacation cannot be forfeited, period. (Suastez v. Plastic Dress Up (1982) 31 Cal.3d 774.)
Often employers institute a paid vacation policy whereby the employees are paid a flat-rate for each vacation day taken, such as $75 per day. It is this practice that employees need to be aware of as they head off into vacation bliss. Since vacation benefits accrue just like wages, the employee is entitled to be paid at his or her regular hourly rate for each vacation hour taken. (Labor Code § 227.3.) This amount often far exceeds the flat-rate actually paid by the employer, resulting in a significant loss of wages to the employee.
Similarly, upon an employee’s termination, California law requires that all accrued but unused vacation time, must be paid by the employer at same hourly rate the employee was earning upon termination. Next time you take a vacation day, check your wage statement to make sure your vacation time is being paid correctly.
If you think you are owed wages resulting from an incorrect vacation benefit payment, please Call (888) 959-8508, or email an experienced Employment Law Attorney at Fernandez & Lauby LLP to discuss your case. An Employment Law attorney will also conduct a free evaluation of your wage statements if you are unsure whether a violation exists.