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About Shirley McAllister, CPP, PHR
Expertise
I can answer questions about payroll laws and payroll tax laws and Human Resource laws and agencies. I can answer federal payroll and human resource law questions and most states; I do not have a knowledge of the local taxes for cities and counties within the state. If and when I can I will try and send you the website where you can reference the answer and where you can obtain more information as well as a contact number if needed for that particular agency. Some agencies I have worked with are IRS, Department of Labor (federal and state), Revenue Canada (and provincial governments), Inland Revenue, OSHA (0ccupational Safety and Health Administration); Social Security Administration and National Child Support as well as other agencies in Payroll and Human Resources. Some Laws I am particularly familiar with are FLSA (Fair Labor Standards Act), ADA (Americans With Disabilities Act), FMLA (Family Medical Leave Act) COBRA (Consolidated Omnibus Reconciliation Act ) , QDRO's, QMCSO's, and other support orders and garnishments, USERRA (Uniformed Services Employment and Remployment Rights Act,PPA Act (Pension Protection Act of 2006, As well as most other employment type acts. I am also well versed in the Title V Civil Rights Act and the HIPAA (Health Insurance Portability and Accountability Act).

Experience
25 years in Payroll and Human Resources

Organizations
SHRM (Society of Human Resources) APA (American Payroll Association) DOLEA (Department of Labor Employers Association)

Education/Credentials
PHR Certification in Human Resources CPP Certification in Payroll in U.S. Payroll Administrator and Payroll Supervisor certification in Canada

You are here: Experts > Business > Corporate Law > Employment Law > vacation pay in California

Employment Law - vacation pay in California

Expert: Shirley McAllister, CPP, PHR - 10/27/2009

Question
Dear Shirley:

I own a small pet store. I finally let go of one employee, who has caused me, and all co-workers hell. she did everything possible in the book to get fired to collect. Now, I received a notice from the labor dept. that she is requesting vacation pay. she worked for me for one year, and nine months, and asking for 66.67 hours of pay. I do not have a written contract or written policy. I did give in the past my manager one week paid vacation, but those were the old days, and cannot afford it anymore. My business is barely surviving. Do I have any rights as an employer.

Thank you

Danny

Answer
you should respond to the Department of Labor that you do not have a vacation policy and do not pay vacation to your employees.

Vacation is not mandatory in the state of California or any other states. It is given by the employer. The only thing that is mandatory is if vacation is given and accrued it cannot be taken away upon termination. If this employe did not accrue any vacation than none needs to be paid.

I strongly suggest that you write up a policy stating that vacation is not given at your company.This may come in handy at a future time.

Sometimes if you have given vacation in the past than the department of labor may say you set policy. I would not mention that you gave someone a week. I would simply say you do not offer vacation to your employees.

Here is what it says on the California Department of Labor site:

http://www.dir.ca.gov/dlse/FAQ_Vacation.htm

Division of Labor Standards Enforcement (DLSE)
There is no legal requirement in California that an employer provide its employees with either paid or unpaid vacation time. However, if an employer does have an established policy, practice, or agreement to provide paid vacation, then certain restrictions are placed on the employer as to how it fulfills its obligation to provide vacation pay. Under California law, earned vacation time is considered wages, and vacation time is earned, or vests, as labor is performed. For example, if an employee is entitled to two weeks (10 work days) of vacation per year, after six months of work he or she will have earned five days of vacation. Vacation pay accrues (adds up) as it is earned, and cannot be forfeited, even upon termination of employment, regardless of the reason for the termination. (Suastez v. Plastic Dress Up (1982) 31 C3d 774) An employer can place a reasonable cap on vacation benefits that prevents an employee from earning vacation over a certain amount of hours. (Boothby v. Atlas Mechanical (1992) 6 Cal.App.4th 1595) And, unless otherwise stipulated by a collective bargaining agreement, upon termination of employment all earned and unused vacation must be paid to the employee at his or her final rate of pay. Labor Code Section 227.3 The California Legislature, in order to ensure that vacation plans were fairly and equitably handled, provided that the Labor Commissioner was to "apply the principles of equity and fairness" in resolving vacation claims.

Shirley

Danny,

Don't give up. You are in a hard place to run a business as California laws are the most liberal toward the employee out of all the states.

The answer to help is write a policy for everything, it does not have to be long it can be one paragraph, but if you have it in writing than you can enforce it. Make sure it is legal in your state. If it would help, I could email you my employee handbook that has all of our policies, you are most welcome to adjust them and the handbook to fit your company. You can email me at smcallister@aimintl.com. My handbook is not copyrighted as I wrote it, but it has been used as a class assignment in a local college and the content analyzed for legal compliance. I am pretty satisfied with it. The only thing that you can not do is put in a use it or lose it policy on vacation in california it is not allowed. You can say no vacation, you can say you must work a year and you can have 1 week, you can put a 1 week cap so that no more is earned than one week, once given you just cannot take away. My book has a use it or lose it because in Idaho it is allowed.

If there is anything I can help you with in HR or payroll to make your job easier than feel free to ask. After 30 years in HR and Payroll 27 at this company I have probably encountered it at least once or can figure it out.

Good luck to you.

Shirley

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