The company's vacation policies are that employees accrue vacation time in one calendar year for use in the next calendar year. Accruals for employees with more than 5 yrs of service are 15 days/120 hours, or 10 hours per month. An employee is leaving the company after six months of work in 2004 and has used all of their 2004 vacation (accrued in 2003). Are they entitled to be paid out for six months of accrued vacation for 2005 (accrued in the first six months of 2004) as part of their last paycheck?

That has always been my understanding of California law. I just want to confirm that I'm interpreting the laws correctly. Thanks.

Yes, you are. California does not permit "cliff" vesting of vacation. In other words, vacation must be accrued.

Let me know if you have any other questions.

If an employee in California has worked for three years and was paid accrued vacation time upon lay off and then was brought back to work five months later does he continue his vacation accrual or does he start over. Company policy is one week vacation after one year, two after three and three after five.

That is completely up to the company's policy.