Legal Question in Employment Law in California
PTO benefits changed to separate vacation and sick time.
My company's HQ is located in Virginia, my base of employment and home is California.
Recently HR announced that our PTO policy would be changing from PTO to separate Vacation and Sick time pools. To facilitate this they would be transfering our PTO into our vacation time up to a certain point. Anything above and beyond that point (one years worth of accrual) would be paid out up to another years worth of accrual. Anything beyond that would be rolled into out sick time pool, something of which we have no control over.
While I have my problems with the new Vacation policy, the question revolves around the payout. A few of my coworkers have been with the company a very long time and have a lot of time acrued, under the PTO policy we acrued it very generously. A lot of stand to loose to sick time what would be paid out by law if we were to leave the company. Is it legal for my company not pay us out for this money and instead roll PTO which we control into a pool of sick time we have no control over?
thanks for the help.
2 Answers from Attorneys
Re: PTO benefits changed to separate vacation and sick time.
A company can't retroactively deprive you of earned and vested benefits. If that is what is happening, you have a potential claim that could be brought to prevent the loss. Contact me if interested in discussing the facts and hiring counsel.
Re: PTO benefits changed to separate vacation and sick time.
A company is required under CA law (they are governed by California law for their California employees) to pay all vacation pay, and to allow workers to use all vacation pay, per the personnel policies (but a company cannot have a "use it or lose it" vacation policy.), and to pay all unused vacation upon termination. A company is not required to do that with respect to sick leave (no payment is required upon termination.)
Companies choose to use PTO primarily because it is easier to administrate than to keep separate track of sick leave and vacation pay. However, when they use PTO, they cannot differentiate between sick leave and vacation time. They are, therefore, required under CA law to classify PTO time under the rules for vacation pay, and to pay all unused PTO at termination. They should also allow everyone to use the PTO until it has run out.
Further questions, email: [email protected]
Alden Knisbacher
Attorney at Law
444 De Haro Street, Suite #205
San Francisco, CA 94107
415-522-5200
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