If I sold my business and an employee had accrued some vacation time, am I legally obligated to pay her for that time?

I, of course, encouraged her to take time off before the acquisition but she did not. I had my company’s PTO policy set so that it did not carry over to the next year if it was not used.

Asked on February 25, 2015 under Employment Labor Law, Colorado

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

No, there would be no obligation unless there was some written employment agreement stating that in the event of the termination of employment, employees would be paid out for unused vacation, and her employment terminated as a result of the sale. And even in that case, if the business had been an LLC or corporation, you personally would not be liable for the payout.


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