Accrued Vacation

Red · January 2002

Our vacation time is accrued, however we have always had a "use it or lose it" policy. If you don't take all your accrued vacation by the end of the year you lose it. Is this legal?

TheCol · January 2002

Vacation time is considered a "gift" from the employer and he/she can make any reasonable and non-discriminatory rules that he wants. "Use or Lose" is routine. It should be written that way in your employment manual.

Cathie · January 2002

Sorry, but I disagree. Quite a few states, including Louisiana, forbid use it or lose it policies.

Down_the_Middle · January 2002

Cathie's right. I believe all states now specify that accrued vacation is considered wages and the "use it or lose it" situation reduces the wages of those involved. You might want to re-think this policy and shift to sometype of max accrual policy where the use-it-or-lose-it provision no longer applies.

Theresa Gegen TX · January 2002

You need to look at your state's law. In Texas a use it or lose it policy is okay as long as the policy is in writing. There are good reasons to have a use it or lose it policy, atleast to some extent. Without it, a company will run into the situtation of an employee who never takes vaction, then ends up with 6 months or one year accrued. If your state does not allow use it or lose it policies, you can do what some other employers do to make sure employees use it. The employers get around this problem by forcing employees to take vaction in the year (If the employee doens't scheduled the vaction, the employer will schedule it for him or her).

Good Luck!

Rockie · January 2002

This is a slightly different question, but if accrued PTO is considered wages, is it legal for an employer to withhold payment of PTO if employee does not give a proper notice of resignation. I know some states say no - employers cannot keep PTO as it is considered earned income, but a lot of employers still exercise this practice.

Down_the_Middle · January 2002

I can tell you that this is not legal in Louisiana and I don't believe it's legal in many other states. {I hate to make such a general statement, but when I researched this many months ago, I remember this issue also being verboten in many other parts of the country---just can't recall the states right now.]

Cathie · January 2002

Just off the top of my head, it would not be legal in Massachusetts, California or Illinois.

Accrued Vacation

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