I have a friend who works for a small business (under 10 employees) that puts on fundraising events for various political causes. Recently, my friend's assistant, a full-time employee, tendered her resignation; her last day will be Friday. She has unused vacation time that my friend believes must be paid out to her along with her final check, but the owner of the company told my friend that the company was exempted from paying the accrued but unused vacation time, based upon the small number of employees in the company. This just doesn't sound right to her & she believes her boss to be mistaken about being exempt for that, or for that matter, ANY reason.

Her boss isn't an ogre & isn't trying to be malicious in any way - my friend just thinks that her boss has the facts wrong on this, but isn't 100% sure. She'd like to go to her boss on Monday with accurate information on the subject so that they're able to give my friend's assistant a final check on Friday with the security of knowing that the check is for the appropriate amount.

Are there any exemptions for employers when it comes to paying out accrued, unused vacation time to an employee on their last day of employment with the company?

Many thanks in advance!

California labor code section 227.3 requires payment of accrued vacation at the time of discharge /notice.

I am unaware of any exception of the type described. The CA rules are listed below, and I am pretty sure that exception is not listed. The employee can ask the employer to cite the actual reference (if any). The employee can file a wage claim with CA-DLSE and if the employer is right (not likely) CA-DLSE will support the employer. There does not seem to be any downside to the employee for filing the claim.

In the unlikely event this turns out to be a real exception, I would be thrilled to get an actual reference source.

http://www.dir.ca.gov/dlse/FAQ_Vacation.htm

Accrued vacation is treated as earned wages and would be subject to the provisions of Ca labor code 203.

See what the employer says. Since this is not a hostile situation there should be no problem.

OP are you non exempt( paid hourly) are you under a CBA?

Thank you all so much - my friend & I both believed that to be the case. We can't imagine where her boss came up with the idea that based on the number of employees in a company, some accrued vacation hours needn't be paid out upon resignation/termination.

BTW, everyone who works for that company is a full time, non-exempt, salaried employee. Would it make a difference if they were exempt, hourly or both?

If you were exempt and under a contract perhaps. It seems to me the employer owes all accrued vacation / wages.

There are some pretty bright Hr people and attorneys who answer on this board. Perhaps they could be of help.

Personally I think LC 227.3 and 203 apply . Talk to your local DLSE . Never heard of any employer because of the amount of employees bieng exempt and I cannot find a referance to this.

Post back and let us know what you find out . I am curious.

Good luck

Interceptor