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Is a retroactive reduction in paid holidays legal in CA? California

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  • Is a retroactive reduction in paid holidays legal in CA? California

    I've read the FAQs and don't think this particular question is addressed:

    In the past, my employer listed the number of holidays we'd be paid for in our annual Memorandum of Undersanding document. Later, they would send a memo listing the holidays that would be paid. This year, the MOU refers to an employee handbook that we have not received (they have been writing one for quite some time). I've been paid for Independence Day in past years. This year Independence Day fell after the effective date of the new MOU. There wasn't any communication to employees about holiday pay or that certain holidays would no longer be covered. I included Independence Day on my timecard as a Holiday but wasn't paid. When I ask about it, my guess is they tell me that the Handbook will (someday) say that Independence Day isn't covered. Is that legal since they, in effect, didn't explain there would be a reduction in benefits? I think most people would question the ethics of it, but I'm wondering about the law. Thanks for any help or reference to the part of the Labor Code I can search.

  • #2
    Under no law, Federal or state, in any state, is an employer required to provide any paid holidays at all. In the absence of a legally binding contract or CBA that specifically says otherwise, no non-exempt employee has any legal expectation of being paid when they do not work, regardless of whether they have been paid for the day in question in the past.

    The answer is different for exempt employees.
    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

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    • #3
      Agreed. I suppose in theory that some exceedingly stupid employer could have in theory gone out of their way to write a company policy manual that could never be altered for any reason, and could have managed to paint themselves into this particular corner, but it is actually harder then it sounds. Policy manuals are almost never legally enforcable contracts, and neither the feds or CA consider fixed holidays to be mandatory or vested. So absence extreme stupidity, what CBG said. A contract or CBA could get around the normal common law rules allowing any changes not prohibitted by statutory law to be made on a go forward basis. If you want to persue this, have all related documents reviewed by a local atorney. But I am seriously not optimistic.

      The one obvoius exception (also already mentioned) is that if an employee is both Exempt and legally subject to the Salaried Basis (29 CFR 541.602), then a company holiday poicy is a legally insufficent reason to dock the salary for those employees only. In theory a same argument could be made for non-exempt salaried employees being paid under the Fluctuating Workweek or Belo Plan methods. The problem with that argument is that CA does not allow either method in the first place, so not an issue in CA.
      "Reality is that which, when you stop believing in it, doesn't go away".
      Philip K. **** (1928-1982)

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      • #4
        Actually, I re-read the posting and maybe have a different answer. Under common law, changes can be made on a go forward basis. An argument can be made that since the change was made retroactively without prior notification that the changes cannot go into effect until the point of notificaion. While there is no legal requirement that holiday pay be made, or any compensation in excess of mininum wage for that matter, employers can still be held responsible for agreements made and not honored. Especially in CA. I am not saying this is a sure thing, but the argument has legs. The obvious counter argument to be made by the employer is "liar, liar, pants on fire" defense. They can claim that they made the notification, either directly or functionally. Say that the manual was available and the employee in question choose not to read it. Argue that facts as opposed to the law.

        HOWEVER, there is no question that absent a contract or CBA that changing the paid holiday schedule (or eliminating it all together) is perfectly legal on a go forward basis as long a prior notification occurs.

        Also, Memorandum of Undersanding is an odd phrase. One that sounds like there should be a CBA associated with it. Now I have worked for employers who have used odd phrases in a manner not consistent with common legal practice. Perhaps this is what is happening here.
        "Reality is that which, when you stop believing in it, doesn't go away".
        Philip K. **** (1928-1982)

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