While employers are not required by law to offer paid vacation to their employees, those who do offer paid vacation packages must comply with certain legal requirements. In California, paid vacation is a form of wages. Therefore, an employer must pay the employee for all unused vacation time when they quit or are terminated. An employee who is fired or who provides at least 72 hours’ notice of their resignation must be paid all of their owed wages, including accrued vacation, immediately at the time of termination. An employee who resigns and provides less than 72 hours’ notice must be paid all of their owed wages, including accrued vacation, within 72 hours of the date the employee gives notice. Vacation pay must be prorated on a daily basis and must be paid at the employee’s final rate of pay of the time of separation.

For example, an employee who earns $13 per hour and works 40 hours per week who has 15 days of unused vacation by the time she quits on the 219th day of the year must receive $936.00 upon separation.

219 days/365 days in a year = 60 percent of the year worked
60 percent of 120 hours vacation entitlement in a year = 72 hours vacation earned and accrued
72 hours x $13.00/hour = $936 vacation pay due at separation.

If you believe your employer owes you unused vacation pay, you should contact an experienced employment attorney at Strong Advocates to help determine your rights.