Payout of accrued vacation time

My company changed their policy on paying out accrued vacation time last Thursday 6/1/17 to say that they may or may not pay what you’ve accrued at their discretion. Less than a week later 6/6/17, they are laying off an entire division and refusing to pay out accrued vacation. They obviously planned this in order to not have to pay for accrued vacation. Is this legal?

Asked on June 6, 2017 under Employment Labor Law, Connecticut

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

While some states mandate a payout of an employee's accrued but unused vacation time (or "PTO"), CT does not. Accordingly, such a payout is at the discretion of your employer. That is unless your company has a policy of making such payments or it is mandated under the terms of an employment contract or union agreement.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

Unfortunately, your state does not guaranty employees the right to a payout of accrued by unused vacation time: rather, state law leaves this up to the discretion of the employer, in that the employer may adopt whatever policy(ies) it likes in this regard. Further, employers may change employment policies at will, unless those policies are "locked in" by an in-effect written contract. Therefore, it appears that your employer may change its policy to not pay out accrued vacation.


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