Vacation chargeback @ Lay off

mbliek

Is it legal for a company to deduct vacation days from a final paycheck?

Husband was laid off on a wednesday the company(in New York State) claims he used 3 days of vacation that he had not accrued. Therefore, they did not pay him for the last 3 days he worked.

I have never heard of a company doing this and wanted to get some advice.

Thank you for the help.

davids

It is my understanding that recovering an overpayment of wages from a final paycheck is NOT a violation of FLSA. So, if the company is viewing this as the recovery of an overpayment of wages (i.e., he was paid wages to which he was not entitled), they may be within their rights to do so. But, of course, the best way to know for sure is to contact either DOL, your state's wage and hour compliance agency, or an attorney.

ACU Frank

We do it, but we also make it very clear in the employee handbook and in the policy. We don't want any surprises.

NaeNae55

[QUOTE=mbliek;716207]
I have never heard of a company doing this and wanted to get some advice.

[/QUOTE]

Most companies do not pay an employee vacation time when it has not been accrued. This is probably why you have never heard of it. However, it is like prepaid wages and the employer has the right to recoup.

Good luck!

Nae

Still Need Coffee

Do you have your employees sign some sort of acknowledgement on their vacation request form stating that if time is taken, but not accrued, that the amount will be deducted out of their final paycheck?

Barring any contradictory state laws, I would think you'd be fine as long as employees were given notice that this sort of thing could happen.

NaeNae55

You brought up something that was nagging me. Why is this employee surprised about the deduction? It should have been explained and agreed to before any vacation was taken.

mbliek

No, NeaNea55, the vacation policy was not clearly explained in their handbook or at the time Ron was laid off. He did not know that he would be laid off after taking vacation.

He and I have always worked for companies in which you accrue vacation this year to be used next year. Never a company in which you accrue vacation through the current year.

His HR Manager does not take advantage websites like this for advice.

Thank you all for your advice it has been most helpfull.

ACU Frank

Maybe Ron's HR manager uses the site-that-shall-not-be-named. Does he have a confederate flag in the back window of his pickup?

mbliek

Not sure about the confederate flag. I have never met the HR Manager and now that Ron is not working there anymore I doubt I ever will meet him. Probably a good thing as I have a few chioce words for him on how he runs his department.;)