California Vacation Rollover Law: Employee Rights, Accrued Time, and Pay Rules

This article covers California vacation rollover rules, employee rights, accrued PTO, payout duties, and employer limits under state law. It explains how unused vacation counts as wages, when employers must pay it out, and options for unpaid wage claims.

By Brad Nakase, Attorney

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Table of Contents

1. Introduction

2. California’s Right to Vacation Time or PTO

3. Situations in Which Your Employer May Take Your Vacation Time

4. Employer Determining the Vacation Time you Earn: Is it allowed?

5. Termination Effect on Vacation Time

6. How Do You Earn a Vacation?

7. Lawsuit for Unpaid Wages

8. How Employment Lawyers Can Assist

Introduction

Employers are not obligated by the law in California to offer a certain number of paid vacation days or paid time off (PTO). On the other hand, you have the option of taking the number of leave specified in the terms of employment if it requires the employer to offer it.

In addition, California law mandates that you be compensated for any unused vacation time when you quit your work. You might be able to file a lawsuit or an unpaid wages claim to get compensation if your company doesn’t pay you back for the vacation time you’ve accrued.

Under the California vacation rollover law, employees have the right to retain and be compensated for earned vacation time once it accrues.

California’s Right to Vacation Time or PTO

Employers are not required by the California Labor Code to offer paid time off (PTO), holidays, vacation time, or personal days. The majority of California firms offer vacation time as a benefit or perk of employment. Although the law does not mandate vacation days.

Employers often have the final say over who is eligible for vacation time and how their staff members receive it. Businesses could set a waiting time for new hires to earn vacation time.

Vacation time and paid time off should be considered money earned by the employee, if your business offers them (mandated by the California vacation rollover law). If you failed to utilize the vacation time you collected over the course of a year, it cannot be snatched away from you.

Even if you hadn’t utilized your vacation time, it still accrues and does not expire. You cannot be punished by your employer by having your vacation days taken away. The accumulated vacation time that you didn’t utilize must be there in your final paycheck when you quit your employment.

Situations in Which Your Employer May Take Your Vacation Time

It’s important to realize that vacation time is a type of earned income. Therefore, nobody can take away your time off once you have accrued it in accordance with your company’s accrual rate.

California vacation rollover law states that unused vacation time is not forfeited. That is to say, your vacation time is perpetual. California law prohibits companies from claiming that you will forfeit vacation days if you do not use them.

You may still be required by your company to use your time off and spend your vacation time throughout the year, though. In order for their employees to accumulate too many vacation days, many firms also mandate that they take time off.

The majority of California businesses also set a cap on the total number of vacation days you can accrue in a given pay period. According to the California vacation rollover law, companies are not allowed to punish employees by deducting their earned vacation time.

However, companies cannot take back vacation time that workers have already acquired or earned, even though they can alter company policy to prevent employees from taking time off. Your employer may violate the California vacation rollover law. You will be eligible for compensation through an unpaid salary settlement.

Employer Determining the Vacation Time you Earn: Is it allowed?

Employers are legally permitted to impose restrictions on paid time off or vacation time. For instance, they can mandate that workers take a certain period of time before they can request time off.

Some employers might demand that workers have a manager/supervisor approve their vacation requests. The number of consecutive vacation days you can take may be restricted by other employers. Additionally, some employers might list “blackout times” or specific days for vacation that workers are not permitted to take.

Employers are not allowed to restrict vacation time on the basis of discrimination, even when these practices are lawful. Protected traits cannot be used as grounds for discrimination by employers.

Termination Effect on Vacation Time

Your employer must pay you back for any accumulated vacation time if you stop working there or are fired (California vacation rollover law). Not doing this is equivalent to not paying your legitimately earned income.

You have the right to pursue unpaid wages if your employer fails to compensate you for vacation time. Unpaid earnings for every hour worked, overtime, and unused vacation time are all things that employees may request.

How Do You Earn a Vacation?

In California, paid vacation time is simple: you earn it while you work. Specifics may be outlined in your employer’s plan. The general notion is that every week you work, you get a portion of your yearly vacation time. To illustrate, we will consider that you are entitled to two weeks of paid leave. The division of vacation payment would give you about 1.538 hours of vacation pay/week after full working days in a standard 40-hour work week.

One of the benefits enjoyed by employees is substantial paid time off of eighty hours in a year, or 10 days of 8 hours each. Divide the 80 hours of vacation time per year by 52 weeks in a year, and this is 1.538 hours/week.

When an employee leaves, it is necessary to pay vacation money. Suppose on 7^th August, an employee with 120 hours of vacation accumulation leaves the company. Their $13 hourly wage would equate to $936 in vacation compensation. It is a bonus on their way out since they hadn’t taken any days off that year.

Lawsuit for Unpaid Wages

Your company may fail to pay you the wages you have earned during the course of the vacation time accrual, and this may result in you suing them. The law of California prohibits any deduction of accumulated vacation time and also denies unpaid vacation time to departing employees.

In certain cases, an employer’s paid time off policy might be in violation of California labor regulations. This may lead to many claims for unpaid wages.

In other cases, employees may be in a position to file a class action suit to claim lost wages. It is important to remember that your employer can not take undue advantage of your rights given by the California law. It may lead to consequences for your employer.

Your employer has no right to retaliate against you in case you report wage and hour violations, or you claim unpaid pay.

How Employment Lawyers Can Assist

It is essential that you speak with a knowledgeable California wage and hour lawyer about your case if the company has denied you vacation time or has not paid you for time you have accrued after you quit your employment. Reputable California employment attorneys are skilled in defending your rights and assisting in holding your company responsible.

Have a quick question? We answered nearly 2000 FAQs.

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California Vacation Rollover Law: Employee Rights, Accrued Time, and Pay Rules

Introduction

California’s Right to Vacation Time or PTO

Situations in Which Your Employer May Take Your Vacation Time

Employer Determining the Vacation Time you Earn: Is it allowed?

Termination Effect on Vacation Time

How Do You Earn a Vacation?

Lawsuit for Unpaid Wages

How Employment Lawyers Can Assist

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