As an employer, can I offer comp-time/flex-time to be used at a later date as PTO rather than overtime pay?

If so can an employer request that an employee bank or acquire sufficient comp-time/flex-time if the employee does not have enough PTO available for requested vacation time? The vacation was approved initially however; she was notified back in March that she no longer had enough PTO available for her 2nd requested vacation due to call offs etc. Rather than denying the 2nd vacation altogether I offered an alternative of banking flex-time to use for this vacation. The employee refuses to participate but has stated that she will be taking the vacation because it was previously approved.

Asked on July 24, 2012 under Employment Labor Law, Michigan


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

1) No, you may not offer comp or flex time instead of overtime; if an employee is eligible for overtime, you must pay her overtime whenever she works more than 40 hours per week. You can offer her comp/flex time as an additional incentive, over and above overtime, to incentivize her to go beyond the call of duty, if you like.

2) An employer can rescind approval for a vacation, unless the employee has spent money or made other "non-refundable" arrangements already on the basis of the approval. If the employee has not done anything to her detriment which cannot be undone, refunded, or rescheduled, you could retract your approval.

3) Even if, based on 2), you have to let her go on the vacation, if she does not have enough PTO, you could make it unpaid leave--you don't have to pay her if she doesn't have enough paid leave. Or you could "advance" her future vacation days, which means that she will "borrow" her future leave and cannot take additional PTO until she's accrued enough leave to cover what she's borrowed for this vacation.

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