Pto Cap At Year End For California

[Farall]

What is the law for how many hours an employer can cap the accrual rate for PTO at, for year end? We currently ear 6.67 hours every pay period, so approximately 160 hours per year. We are only able to carry over 80 hours however. What is the law on this? My boss wants to make it a zero carryover!

[Parrish]

Your California Labor Relations considers vacation the same as wages. The company does not have to give vacation pay, but if they do than it must be done according to company policy. It is legal to have a cap on the amount that can be earned and no more can be earned until it goes below that cap, however, they cannot have a use it or lose it policy. So if you earn 160 hours they can say that the cap is at 160 hours and no more can be earned until it is used but you cannot lose any of the 160 hours you have already earned.

Here is what the rules say.(PTO is considered the same as vacation).

From s and

[Aviah]

es on the California Industrial Relations site:

My employer's vacation policy provides that once an employee earns 200 hours of vacation, no more vacation may be earned(accrued) until the vacation balance falls below that level. Is this legal? A. Yes, such a provision would be acceptable to the Labor Commissioner. Unlike "use it or lose it" policies, a vacation policy that places a "cap" or "ceiling" on vacation pay accruals is permissible. Whereas a "use it or lose it" policy results in a forfeiture of accrued vacation pay, a "cap" simply places a limit on the amount of vacation that can accrue; that is, once a certain level or amount of accrued vacation is earned but not taken, no further vacation or vacation pay accrues until the balance falls below the cap. The time periods involved for taking vacation must, of course, be reasonable. If implementation of a "cap" is a subterfuge to deny employees vacation or vacation benefits, the policy will not be recognized by the Labor Commissioner.

DLSE has repeatedly found vacation policies which provide that all vacation must be taken in the year it is earned(or in a very limited period following the accrual period) are unfair and will not be enforced by the Division. You can find all the rules or make a wage claim at their website:http://www.dir.ca.gov/dlse/FAQ_Vacation.htm

Shirley