Found an error with our vacation accrual
MIR2011
2 Posts
Our vacation accrual is set at accruing a certain about of weeks based on the amount of years with the company. For example, 5 years of service, you accrue 3 weeks of vacation. It is stated in our handbook that you start to accrue the 3 weeks on your 5th year anniversary. When our vacation accrual was set up years ago, it was described incorrectly as you should have 3 weeks vacation at 5 years of employment, so our payroll company started accruing the 3 weeks at the 4 year anniversary.
We have found the error and have corrected it this year. Without taking any hours already accrued away, we simply slowed down the amount accrued per payroll. We have 1 employee challenging this situation. The employee feels that since past employees accrued earlier and improper therefore benefiting from our mistake, he/she should as well. Stating it is not fair. Our position is we are going by what our handbook says and needed to correct the situation accross the board, not only he/she. We feel if we have the right to correct it as long as we are staying within our employee handbook. If we went with the thoughts of past employees benefited from our mistake so we need to give it to the others, we will never be able to correct the problem.
What I am trying to figure out is the employee has any legal ground? Being that we are in the guidelines of our employee handbook which the employee signed, are we ok making the change? Or does this open us open for legal issues concerning unfair treatment of employees because some benefited from our mistake in the past?
Thanks!
P.S. Not re-reading this as I'm in a hurry, so I hope it all makes sense. 
Comments
Three questions:
We are in California....No notice of the correction b/c it was not a change in policy just a correction....No contracts. We have an employee handbook which is signed and it states the correct information and we stayed within the guidelines. in other words, corrected to what the handbook has been saying all along. It was just a mistake we found and corrected.
California views vacation pay differently from most other states.
Something like this was discussed in a recent BLR webinar but I don't recall all the specifics. Regardless, California views vacation as earned wages, so a reduction in vacation accrual is a reduction in pay. I don't know if that triggers any notice requirements or creates any liability in the employer but a California employment law attorney will :-)