California law does not require employers to offer their employees paid vacation time. However, if employers voluntarily agree to offer paid vacation time to their employees as part of company policy, there are important considerations that employees should be aware of.

Earned vacation time is considered wages under California law and equivalent to cash earned by the employee. This means that if an employee voluntarily resigns or is terminated from employment, the employer must not only pay the employee for all wages due, but also provide the employee payment for any unused vacation time the employee has accrued at the employee’s last rate of pay.

An employer that fires an employee, even for cause, owes the employee any unused vacation time that the employee accrued prior to being terminated. Below are some common questions employees have regarding California vacation time laws.

Can My Employer Require Me to Wait Before Earning Vacation Time?

Yes. If you are a new employee, your employer is not required to immediately provide you with paid vacation time upon starting your new job. The employer may even withhold vacation benefits for a period up to one year. However, an employer that provides vacation time to its other similarly situated employees as part of a company policy may not withhold vacation benefits beyond the probationary or introductory period.

Can My Employer Exclude Me from Earning Vacation Time Just Because I am a Part-Time Employee?

Yes, under California law, employers may decide to cover only a certain class of employees under its vacation policies. For example, employer vacation policies may only cover full-time employees, and exclude part-time, probationary, or temporary employees. However, an employer may not deny vacation time based on an illegal reason such as an employee’s race or religion.

Can My Employer Set Caps for the Total Vacation Time I can Earn?

Yes. Employers in California are permitted to set the maximum number of vacation hours an employee can earn. This should be distinguished from a “use it or lose it” policy where the employer cancels or forfeits vacation time that was already accrued by the employee. “Use it or lose it” policies are not permitted because they take away vacation time that was already earned by the employee. However, a cap on the amount of vacation hours is allowed because the employee stop accruing vacation time after the maximum number of accrued vacation hours are reached.

Example: Company X allows all full-time employees to accrue 12 days of vacation time per year. However, employees are prohibited from carrying over more than 17 days of accrued vacation time to the next year. Employees who have reached the 17-day accrual mark will stop accruing vacation time until the employee uses vacation time to fall back below the 17-day roll-over limit. Employers, however, may not take away the 17 days of accrued vacation as these are considered wages already earned by the employee.

Can My Employer Control when I take my Vacation?

Yes. Employers in California may require employees to follow certain vacation scheduling procedures. For instance, an employer may require the employee to request vacation time off a certain number of days or weeks in advance.  In addition, employers may set aside certain days of the year when vacation time off is unavailable for all employees.  For example, a department store may limit its employees from taking vacation time during the peak holiday season.

When are my Vacation Wages Due if quit my job or am fired?

California requires employers to pay accrued vacation wages for employees who have been fired immediately after being let go. Similarly, if an employee quits and gives notice within 72 hours of leaving, the employer must pay the final wages including accrued vacation time at the time of resignation. However, if an employee gives less than 72 hours notice of their desire to quit, then final wages, including accrued vacation time are due.

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We’re here to help. If your employer violated your rights as an employee, including not paying your accrued vacation wages, call us today 1-844-444-9965 for a free and confidential consultation with a skilled California labor rights attorney. If retained, we will fight on your behalf to help you obtain the compensation you are entitled to.