Vacation time pay in lieu of time off

Is anyone paying employees for vacation time (on the Books) in lieu of taking the time off? Say in the case that an employee is at or near max on time for the year and he would like the extra pay instead of taking the time off. What would you do? We have several employees that would like the extra pay (5 days) instead of taking the time off. If you do pay them what are your rules and how do you handle it.


  • 10 Comments sorted by Votes Date Added
  • When an employee is approaching the maximum accrual, Payroll notifies the employee that they are at risk of losing future accruals. If the employee requests time off but, due to workload, the department denies the request, we would allow the employee to cash out up to 40 hours of vacation leave. We do not allow employees to just cash out the time, when they have opportunity to take vacation leave. The problem with allowing employees to cash out the time at whim, if a significant number make such a request, is that the department would not have budgeted for it.
  • We allow employees to cash out up to once per calendar year. They get leave at 50% if they take it in cash. They must take it in 8 hour increments, and must have a balance of at least 80 hours after cashing. We have a few takers, but not many as most don't want to lose that 50% value.

    Employees have a max accrual. I have tried notifications, increasing maxes, and now the option to cash out some. We still have at least 1 employee who occassionally loses leave time because they maxed out. This is not due to work loads, but just not taking time off.
  • We do not. Our vacation program is use it or loose it, with no carry over to next year.
  • We allow employees who have at least five years of service to cash vacation days in conjunction with actual vacation time used. In other words, its not just "here, have some cash" but "here, have some cash for your vacation". Not all requests to cash vacation are approved. Our executive director considers each one in light of our current cash flow.

    Its a nice benefit and I have used it several times to help pay for time off. I have trouble using the vacation time I earn so cashing some in has been a nice benefit.
  • [quote=joannie;716887]What Dutch said.[/quote]

    What Dutch [B]and [/B]Joannie said. You 'use it or lose it' here. As a Bank our insurance policy requires each employee to be out at least 5 consecutive business days. Most people do not have trouble using their remaining time off.
  • At our company when an employee is eligible for 3 weeks they can cash out one week. If they choose to do this, they have to do it when they are taking a week of vacation. Also, it is bonus taxed.
  • use it or lose it by year end
  • Our policy states that if work circumstances prevent an ee from taking there vacation time to be below max, their supervisor must sign off on an approval form, citing the reason/need for not allowing the ee to take time. If budget then permits at year end we will pay out up to the accumulated hours for the current year, as taxable income. For the past 3 years due to budget restrictions we have not paid. Some employees do try to abuse this policy as they just do not schedule vacation intentionally, hoping to be paid which I am dealing with right now with a supervisor for his time.
Sign In or Register to comment.