Vacation Pay

Unless you are covered by a collective bargaining agreement or employment contract that requires you to be given vacation time, the law does not require employers to give their employees any vacation time off, paid or unpaid. Most employers choose to do so to prevent employee burnout and maintain employee morale, but it is not legally required.

There is no federal law that governs vacation time. While a number of states have laws that require employers to pay their employees any vacation time they have accrued, those laws do not require employers to give their employees any vacation time at all.

Even if your company offers vacation time to some of its employees, it may have policies limiting who is eligible. For example:

Part-time or temporary employees may not be entitled to vacation benefits at all, although some companies make these benefits available on a pro-rated basis.Employers may require that employees work for the company a certain length of time, sometimes as much as six months or a year, before accruing vacation time or being allowed to use accrued time. (As Americans change jobs more frequently, this can mean that some employees frequently have to start all over again.)High-level or higher-paid employees may accrue more vacation time than lower-level or lower-paid employees. An employee may even negotiate more vacation time as a condition of accepting the job, although some companies are reluctant to do that, out of fear that other employees will feel slighted or claim they are treated unfairly.

All of these policies are legal, as long as they are administered according to the policy established by the company, and not used to discriminate against certain employees.

While it might seem reasonable that you be allowed to bank your vacation days from year to year in order to take a longer vacation, many companies have policies that prevent you from doing so. Some of the reasons cited by employers for having such policies include preventing employee burn out, limiting the negative impact of more the team, and limiting the financial exposure of the company when employees leave. 

“Use it or lose it” policies are illegal in states where vacation time is considered to be compensation that must be cashed out when an employee quits or is fired from the company. To withhold vacation pay in these states is the same as failing to pay employees compensation that they have already earned. However, employers in these states may still set accrual caps, whereby employees may only accrue a set number of vacation days.

Where providing vacation time is not required by law, state law and the internal policies of your employer govern the use of vacation time. If you are attempting to use your vacation time, and your employer is not allowing you to use your time, your best bet in this situation is to attempt to work cooperatively with your fellow employees, possibly the Human Resources department if you have one, and company management, to resolve this problem in a way that works for everyone. It is also wise to plan ahead as early as possible, as last-minute requests may be more difficult to accommodate. Scheduling your vacation as early in the year as you can, and during times that are not as in-demand (such as during school vacations or holiday weekends) is also a good idea, because employers may not be able to accommodate everyone who wants to take a vacation at the same time. Submit your request in writing, and have backup dates available if your first choice of dates cannot be accommodated.

More companies are moving to a “paid time off” (PTO) system where days off are not designated as vacation leave, sick leave, or personal leave. Employees are given a number of days to manage however they choose. If they rarely get sick, they can have more vacation/personal leave days. If they are sick enough to not be able to work, they can take the time off they need, but it may cut into the amount of vacation time they can take. These policies are designed to give employees more flexibility and to ease the administrative burden of tracking and policing workers’ use of their time off. Employees don’t need to tell white lies, such as claiming to be sick when they’re not, and they can use the days however they think is appropriate. For example, a working parent might use the time to care for a sick child or attend a school conference, while someone without children might want to take more vacation leave.

Where an employer has a PTO policy, remaining PTO days are generally treated the same as vacation days under the law when an employee leaves the job – see question 5 below. These days are considered to be accrued by the employee and payable when the employee leaves the job.

It depends on your employer and where you live. There is no federal law for accrued vacation time; many states have laws that address accrued vacation time. se and break it. To learn more about your final paycheck, visit our Final Pay page. Visit this website for an overview of state law.

As mentioned above, there is no federal requirement that employers give their employees vacation time. This means that employees who have been denied time that they accrued, in the states where payment of accrued vacation is required, must look to those states for enforcement. If your employer did not include your vacation time in your last paycheck and refuses to issue another check after the problem is brought to its attention, then you should contact a state government agency and/or a lawyer in your area to help you determine how to proceed. Visit workplacefairness.org for a directory of employment attorneys.

If you do not get the help you need from the agencies you contact, small claims court is also an option. Because of the small amount of money involved, you may be able to pursue a claim against your employer more quickly and inexpensively in small claims court, and you will not need a lawyer. For more information about small claims court see NOLO’s small claims court resources.

Yes, an employer can force you to use a vacation day when your workplace is closed due to weather. The reason being is that there is no law requiring employers to offer vacation time in the first place. However, the employer cannot make up the policy the day it snows. The weather policy must have been in writing or posted where it is accessible for employees.

If you need further information about your state’s law relating to vacation accrual and/or wish to report a potential state law violation, then you may wish to contact the agency in your state which handles wage and hour/labor standards violations. Visit our website’s state government agencies page for that information.

Your state wage payment law will govern the methods for recovery of unpaid wages, including vacation time, and the remedies to be awarded to those who succeed in proving a violation. For further information, please contact the agency in your state which handles wage and hour/labor standards violations. Visit our website’s state government agencies page for this information.

Your state wage payment law will have deadlines for recovery of unpaid wages, so it is important that you contact them as soon as possible to find out what those deadlines are. For further information, select your state from the map below or from this list.