RSS SyndicationTrap #1 – California employers are not required to provide paid vacation to their employees. However, once the employer does start providing paid vacation, employees are deemed to be entitled to accrue the vacation pay from the first day of employment. This is so even if employees are not allowed to start taking vacation until they have been on the job for a year. The state of California deems vacation pay to be part of an employee’s earnings, even if the employer feels she is providing paid vacation out of the goodness of her heart!
This means that employees who are fired before they are allowed to take a single vacation day must still be paid all of their accrued vacation on the date of termination.
Trap #2 – Now, a new California Court of Appeals case, Church v. Jamison, 143 Cal.App.4th 1568 (2006), adds insult to injury. Courts, and the California Labor Commissioner, had previously held that employee claims for unpaid vacation were subject to a statue of limitations. In the Church decision, the court ruled that there are no statutes of limitations on the vacation pay claims.
Employers who do not cap unpaid vacation accrual are particularly vulnerable.
I guess in California, no good deed goes unpunished. Employers who chose to offer paid vacation should consult with counsel on establishing reasonable caps on vacation accrual.