Reimbursing Vacation at Termination

An employee used up all vacation time in the first six months of the year and recently resigned. The employer wants to deduct for several days of vacation pay from the employee's final paycheck on the grounds that he didn't work the entire year.  There is nothing in the employer handbook to address this and vacation is awarded at the beginning of the calendar year.  So, I don't see that the employer has a leg to stand on.  I also have advised them that the payroll deduction would likely be illegal.   Any thoughts on this?        


  • 3 Comments sorted by Votes Date Added
  • What state are you in? Many times, state law governs this type of issue.If not, I agree that it would be difficult to address this in the absence of a clearly worded policy. Sounds like you may need to revamp your accrual/use policy so that you can guard against this.
  • If I understand your question, you do not list in your handbook that you accrue vacation time during the calendar year. And what has been your practice in other terminations?  Remember that what we practice is indeed what our policy becomes. And it is also important that all employees are being treated the same way in regard to vacation pay.  Another question on this subject:  Was this employee a salary exempt employe per wage & hour standards?

    good luck


  • It looks like you are being the voice of reason...stick to your guns. Make sure folks know that this is not a personal slight against them...think about it rationally. If they step back and look at it from all sides, they will see your point.

     The first two comments are on the money - see what your state allows, then look to see what you have done in the past. (Remember, if the same situation has occurred and you did not take action before, you will have a real problem on your hands if you take action now.)

    While some states are very generous in what action they allow you to take (Ohio being on of them), it is usually the case only when you have a clearly stated policy. Looks like this will turn out to be a "close the barn door..." kind of thing.

    Good Luck!! 

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