Unpaid Vacation Pay Wage Claim

There are at least two types of vacation pay wage claims. The first occurs if you accrued vacation pay and it was not paid to you when you left your job (whether you quit or were laid-off or terminated), and it wasn’t paid to you. The second is if the employer does not comply with California law with regard to the way vacation pay is accrued.

The Law

Vacation pay is considered “wages” under California law. All wages, including vested vacation pay, must be generally paid at the end of an employee’s employment. If the employee is terminated involuntarily (i.e., fired, laid-off, released, etc.) , the vacation pay that the employee has earned must be paid on the employee’s last day of work. If the employee voluntarily terminates his or her employment, the vacation wages must be paid within 72 hours of the employee’s last day of work. (These rules may differ for some types of employees — check with an experienced wage claim attorney to ensure that they apply to your situation.) The vacation pay must be made at the employee’s final rate of pay.

California employers do not have to provide vacation pay to their employees. However, if they do provide it, they must do so in accordance with California law. California employers CANNOT:

  • Attempt to take back any earned vacation pay
  • Have a use-it-or-lose-it vacation pay policy (i.e., the policy provides for the forfeiture of vacation pay that is not used by a specified date)
  • Delay the accrual of benefits until after a probationary period (i.e., an employee only starts to accrue vacation after a 90-day probationary period, but see the exception below)

California employers CAN, however:

  • Put a cap on vacation accrual (i.e., the employee cannot accrue more than a certain number of vacation pay hours or days)
  • Control the scheduling of vacation time or the amount of vacation that may be taken at a particular time
  • Pay off employees each year for vacations that have accrued and vested for that year but have not been taken
  • Exclude certain classifications of employees from vacation pay benefits
  • Institute a probationary period so long as vacation pay accrues during the probation period (i.e., in order to be entitled to vacation pay benefits, the employee must work for the employer for 90 days, but vacation begins to accrue starting on the employee’s first day of work)

The Consequences

If you were not paid your vacation wages, or if your employer did not manage its vacation policy in accordance with California law, you could be entitled to recover accrued vacation wages, plus penalties for the willful failure to pay (a maximum of 30 days of wages). Contact an experienced wage claim attorney now for an evaluation of your vacation pay wage claim.