CTO Usage

Torrance

Can an employer use a non-exempt employee's Combined Time Off, which the employee has accrued and has cash value, without the employees written consent? Our corporate payroll department automatically draws from an employee's CTO account to make sure that the employee gets paid for 40 hours every week. Many employees would like to reserve their CTO for future vacation/holiday time and not be paid if they miss a day due to illness. Is there a federal law or a California law that covers this issue? Thanks.

Rockie

Generally speaking, it depends on how your policy is written. In our organization, we have PTO (Paid time off) which incorporates vacation time and sick time. If an employee has time in his/her bank and is out sick, time is automatically drawn from it to cover the sick time. Same for vacation time. We do not allow employees to take Leave Without Pay if there is time available in their banks.We have very generous paid time off and if an employee runs into a Leave Without Pay status, we regard this as mismanagement of their PTO banks. (Except in the case of FMLA, of course). To allow employees to keep their "banks" and take LWOP would enable employees to amass huge leave banks that would ahve to be paid out upon termination.

Now....you DO need to check your California laws because I suspect there is probably something to cover this issue within the state law. Laws vary widely from state to state regarding amassing leave time, what rights employers have regarding tapping into this time, paying out this time upon resignation, etc. Your state DOL can help with this.