Employee Vacation Benefits

In the absence of employment agreements that mandate to the contrary, employers do not have to provide employee vacation benefits. In other words, there are no Federal employment or labor laws that require it.

Nevertheless, many employers have voluntary provided employee vacation benefits, just as they traditionally have provided other benefits that are not required by agreement or law.

Employers have done so, to attract and keep employees. But, because providing employee vacation benefits is voluntary, employers may impose limitations and other conditions that are not in violation of state laws.

For example, your employer likely has the right to make you postpone your scheduled vacation leave, for justifiable business reasons.

On the other hand, to rightfully impose vacation benefit conditions and enforce them, employers typically must clearly document the conditions, such as in policy handbooks for employees. Employers typically must also make employees aware of such conditions in advance, as well as the consequences for violating them.

If you violate a clearly-documented employee vacation benefit policy, then your employer likely has the right to deprive you of some aspect of the benefit, such as pay for vacation leave you took without authorization. Your employer might even have the right to fire you for company policy violation.

However, if employers don't fairly and equally apply vacation policies to all employees working in the same groups, including discipline for violating the policies, then "cheated" employees might be entitled to file lawsuits.

Despite that providing it is initially voluntary, if employers allow vacation pay to accrue by policy or agreement, then states laws might require the employers to issue accrued vacation pay to employees who've earned it, soon after their employment ends.

Many states have such laws. They typically require employers to include accrued vacation pay in employees' final paychecks, in a timely manner. But, even in states that don't have such laws, if employer policies "promise" accrued vacation pay, then the employers typically must make good on their promise.

On the other hand, if employees do something wrong, such as not giving the required resignation notice according to company policy, then employers are not obligated to issue accrued vacation pay, if state laws don't prohibit employers from withholding it.

The Minnesota Supreme Court overruled the decision of a lower court regarding vacation benefits (PTO), in the 2006 case of Lee v. Fresenius Medical Care, Inc. The lower court interpreted a state law to mean that employers must issue accrued vacation pay to departing employees, even if they were fired for misconduct per policy. But, the Minnesota Supreme Court indicated that the lower court had misinterpreted the law.

Read About Employee Benefits for information regarding avenues of relief, should your employer deprive you of the vacation benefit or any other employee benefit to which you're rightfully entitled. Alternately or additionally, consult a lawyer.