California Vacation Payout at Termination

PamJ

We are headquartered in the midwest and operate a retail business in California. We are wanting to determine if we are obligated by law to pay out earned but unused vacation time at termination if we have a written policy in place that states: "Earned vacation is typically paid out at termination, providing you have been employed for at least one year. However, associates who fail to give at least one week's notice of their resignation, or associates who are terminated for gross misconduct, will NOT be paid earned vacation."

Section 227.3 of the California labor Code states that unless otherwise provided in a collective bargaining agreement.....all vested vacation shall be paid.....provided, however, that an employment contract or employer policy shall not provide for forfeiture of vested vacation time upon termination.

It is the "provided, however" part of the code that seems to override the obligation. Any input from more seasoned California HR professionals is greatly appreciated.

cebudragonlady

Not paying earned vacation here in California upon termination is asking for trouble. Pay it, and save yourself the attorneys fees.

Chari

gillian2

Ditto to cebudragonlady - if you don't pay immediately and get a wage claim filed against you, you will pay the vacation pay plus one day of pay for each day that you are late - up to 30 days - and interest as well. Your company policy won't cover California employees.

Eliant

I concurr with the others.
Your policy does not apply in CA. Here you must pay for everything. You don't
want the labor department knocking at your door.

Eliant