Termination and unused vacation

davekunes

Does Delaware require us to pay an employee who has been terminated for violations, his accrued vacation time?

tkessler_blr_com

davekunes, here is a response from Delaware Employment Law Letter editor Lauren Russell. As you can see below, she is an attorney with Young Conaway Stargatt & Taylor, LLP, in Wilmington. Hope this helps! tk
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Payment of accrued but unused leave (be it vacation, sick, or general personal time off) is governed by the Delaware Wage Payment & Collection Act (WPCA). Under the provisions of the WPCA, the value of leave is considered a fringe benefit, and is not part of wages. Consequently, there is no statutory duty to pay the value of leave at the time of termination, like there is a duty to pay earned wages. However, to the extent that the parties have entered a contract that provides that accrued but unused leave will be paid out at the time of termination, there is such a duty. This is one of the rare cases where a handbook policy will be considered contractual under Delaware law. Thus, if your employee handbook (or your company’s past practice) indicates that employees will be paid for the value of accrued but unused leave at the time of termination, there is a duty to do so.

Lauren Moak Russell
Young Conaway Stargatt & Taylor, LLP
Rodney Square
1000 North King Street
Wilmington, DE 19801
P 302.576.3255
F 302.576.3750
[email]LRussell@ycst.com[/email]