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Patrick, Esq.
Patrick, Esq., Lawyer
Category: California Employment Law
Satisfied Customers: 12941
Experience:  Significant experience in all areas of employment law.
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My company was acquired through a stock purchase agreement.

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My company was acquired through a stock purchase agreement. The buyer says we have the same employer as before the sale so no accured vacation need be paid out. However, we are now being paid by a different company and have a different EIN number. Am I out my accrued vacation and if so, buy which entity? If not, why not?
Good morning and thank you for entrusting me to answer your question. I will do everything I can to assist you.

To be clear, is the buyer saying that you lose your accrued vacation, or simply that the change in ownership does not trigger an obligation to cash it out?

I very much look forward to helping you on this matter.
Customer: replied 4 years ago.

I replied to this question early this am. The buyer is saying that we still have the accrued vacation? but it is not recorded anywhere except on an internal spreadsheet. We are actually accruing vacation on the buyer's system. The buyer is allowing some people with a 'hardship' to cash out part of the vacation accrued under seller because the new company's paydays are different and instead of getting paid on the 30th of April, the next pay day is May 10th. Tis cash out optopn was not available to everyone.


Thank you very much for your reply. I apologize if you sent something to me earlier, but all I have received is your post immediately above.

I completely understand why you are concerned about your employer's treatment of your vacation. Unfortunately, however, the practice you describe does not violate California labor law.

Since employers are not legally required to provide employees with vacation days at all, the law affords employers a great deal of discretion with regard to how and when that time may be used or cashed out.

The only significant limitation on what an employer can do with an employee's vacation days is that an employee cannot be made to forfeit accrued days. California law treats all accrued vacation as a "wage earned," and as such, employees must be either cashed out for all accrued days or allowed to take those paid days off work.

What employees cannot do, however, is demand a cashout, or demand to use their vacation on particular days. So, while an employer can permit certain employees demonstrating "hardship" to cash out their accrued vacation, this does not mean they must permit all employees to do the same. Provided your vacation is not actually forfeited, and your employer is not selectively permitting certain employees to cash out their time on a discriminatory basis (such as only permitting the men to cash out their time) your employer is not violating any law.

Again, I do understand why these practices frustrate and concern you, but the law does not prohibit your employer from doing what it's doing and so there is no basis for legal action.

Please do not hesitate to let me know if you have any questions or concerns regarding the above and I will be more than happy to assist you further.

If you do not require any further assistance, please be so kind as to provide a positive rating of my service so that I may receive credit for assisting you.

Very best wishes to you and thank you so much for coming to Just Answer.
Customer: replied 4 years ago.

Thank you. I was under the impression that when the EIN number changed, that was evidence of a sale and the seller would have to cash out accrued vacation.


It was my pleasure to assist you and I'm sorry I could not provide more favorable information.

Again, please feel free to let me know if you have any further concerns. If I have answered your question, I would be very grateful for a positive rating of my service so that I may receive credit for assisting you.

Kindest regards.

Patrick, Esq. and other California Employment Law Specialists are ready to help you