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PTO at Year End in CA

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  • PTO at Year End in CA

    My company started an office in CA in 2003. Our office is roughly 15 people (300 nationally). All the benefits stem from our headquarters in PA. Specifically our paid Personal Time Off (PTO) has not changed. Any unused PTO time at year end are placed in a "Long Term Disability Bank" for use to cover the first 30 days of a long term disability issue (maximum 5 days/year). Any PTO over 5 days per year will be forfeited at years end. Once 30 days have been accrued in this bank, any future unused PTO at years end is forfeited.

    First, is placing the PTO into a "bank" legal in California or should it be paid at years end or rolled over? Second, are the other two stipulations legal...losing anything over 5 days/year and losing anything once the 30-day bank is filled?

  • #2
    It is definitely a violation of California law for you to forfeit any vacation/PTO you have earned.
    http://www.dir.ca.gov/dlse/FAQ_Vacation.htm

    The policy for transferring vacation into a "long-term disability bank" is questionable at best. What happens to that bank if you terminate without using all of it? Now I would look to the intent of the law, which is to not allow forfeiture of vacation/PTO earned. If you are not paid the banked hours at termination (even if transferring them there would not be a violation of CA law in and of itself), I would opine that this policy would also be illegal in California. However, I would defer to our resident CA attorney/guru Mtracy.

    Michael?
    I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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