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socrateaser
socrateaser, Lawyer
Category: California Employment Law
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Experience:  Retired (mostly)
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I worked for a company in California for a little over 2 years. While doing so i accured

Resolved Question:

I worked for a company in California for a little over 2 years. While doing so i accured a lot of Paid Time Off. The company's policy states that after a certain amount of PTO was accured they would start to put hours into a RLB or bank the hours for emergency use only (i.e hospital visits, extreme sickness).

I later relocated to the state ofWashington with the same company and later left the company. I was wondering if I am to be paid out for all accured hours of PTO, including banked hours, as per the Labor Laws in the state of Californina? Or did I forfeit that right by moving to Washington ?
Submitted: 5 years ago.
Category: California Employment Law
Expert:  socrateaser replied 5 years ago.
Very interesting question.

Law

Vacation pay is treated the same as all other forms of compensation at termination; i.e., accrued vacation pay must be paid to the employee immediately upon an employer-initiated termination and within 72 hours of an employee's resignation. Ca Labor Code §§ 201-202.

The employer must compensate the terminating employee for unused vested vacation time: "(A)n employment contract or employer shall not provide for forfeiture of vested vacation time upon termination." Ca Labor Code § 227.3; see Suastez v. Plastic Dress-Up Co. (1982) 31 Cal.3d 774, 779.

Because vacation pay is a form of deferred wages for services rendered, a proportionate right to a paid vacation "vests" as the labor is rendered. Once vested, the right is protected from forfeiture by Ca Labor § 227.3. Suastez v. Plastic Dress-Up Co., supra, 31 Cal.3d at 784.

Although employers may not require an employee to forfeit vested vacation pay, the employment agreement may place a legitimate "cap" on accrual of vacation pay after which no further vacation will accrue. See Boothby v. Atlas Mechanical, Inc. (1992) 6 Cal.App.4th 1595, 1602-1603.

Question

I was wondering if I am to be paid out for all accured hours of PTO, including banked hours, as per the Labor Laws in the state of Californina? Or did I forfeit that right by moving to Washington ?

A: The fact that you had an employment contract in California means that you are entitled to the benefit of that contract, even if you move somewhere else -- as long as the courts of the place in which you moved are willing to enforce your rights -- and if they are not, then assuming your employer continues to do business in California, then you can sue them in a California court to enforce those rights.

Once you moved to Washington, the vacation rules could be changed going forward, for any new vacation accrued. So, if the employer's policies in Washington are different, then you are subject to those polices -- but not to the extent that you already earned vacation time in California.

The analogy would be the same if you bought a car in California and were entitled to a warranty under California law that doesn't exist in Washington (which is true, because California's "Lemon Law" is different than Washington's). If you can't enforce the warranty in Washington, that doesn't stop you from driving the car back to California and then enforcing the warranty there.

Hope this helps.


And, if you need to contact me again, please put my user id on the title line of your question (“ToCustomerrdquo;), and the system will send me an alert. Thanks!

Customer: replied 5 years ago.
Is my best option going forward to 1) file a grievance with the California Labor Board or is this a civil suit?
Expert:  socrateaser replied 5 years ago.
Unless the employer has notified you that it is forfeiting your accrued vacation hours, then you have no standing to bring a claim for unpaid hours, either to the CA Division of Labor Standards Enforcement, or by way of a civil suit -- because, you're not injured.

Assuming that the employer has stated that it is forffeiting some or all of your vacation hours, or if you are terminated from employment and the employer does not pay the accrued hours to you as cash, then you have a claim.

At which point, I would probably make the DLSE claim. Then, assuming you win, and the employer refuses to pay, that's when it becomes a civil action.

Hope this helps.


And, if you need to contact me again, please put my user id on the title line of your question (“ToCustomerrdquo;), and the system will send me an alert. Thanks!

Customer: replied 5 years ago.
OK. So I when I talked with the HR rep over the phone I was told that because I moved to Washington they did not have to pay my accured (banked PTO). I thought that this was just them being unwilling to pay me out and in hopes that I wouldn't seek advice.

I can get a final pay stub. I believe I had approx 80 hrs of Banked PTO, all earned while working in CA.

My understanding of this situation is that the company follows the rules of the states in which they operate in.

Also, at what pay rate would I be paid out? Would it be my California rate or would it be my final Washington pay rate? .

Thank you for you help to this point
Expert:  socrateaser replied 5 years ago.
My understanding of this situation is that the company follows the rules of the states in which they operate in.

A: California law controls your earnings while in California. Washington law is irrelevant, if you bring the matter to the DLSE or a California court, and the employer still has a presence in California.

Also, at what pay rate would I be paid out? Would it be my California rate or would it be my final Washington pay rate? .

A: Tough call. I would say that the rate would be that at which you were paid at the time the employer notified you that the hours were forfeit, because that represented the breach of contract and created the liability for payment. So, if you had never worked after that date, your wage would never have changed.

Hope this helps.


And, if you need to contact me again, please put my user id on the title line of your question (“ToCustomerrdquo;), and the system will send me an alert. Thanks!


socrateaser and other California Employment Law Specialists are ready to help you
Customer: replied 5 years ago.
ok, thanks for your help.

I think i will go ahead and file a grievence with California Labor Board. The company is still going strong in California. I hope they give me credit for the pay rate from California as I was paid at a higher rate.

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