Ask The Lawyer, VACATION TIME FOR EMPLOYEE WHO QUITS? YOU BET!
VACATION TIME FOR EMPLOYEE WHO QUITS? YOU BET!
QUESTION: One of our employees quit without notice, leaving us short-handed when we were under deadline pressure. We paid her for the time she had worked, up to the day she left, and that was it. She says we have to pay her for paid time off she earned but didn’t use. I understood that the law doesn’t require paid vacation.
ANSWER: Michigan and federal law do not require employers to give employees any vacation, or holiday time. Yet, most employers have a vacation or paid time off policy – and therein lies the rub.
Under Michigan law, MCL 408.474, if an employer’s policy allows workers to earn vacation time, the worker must be paid for any vacation time earned but not used when the employment relationship ends — unless the policy states otherwise. What a policy gives (vacation time), a policy can also take away, but any revocation of earned vacation time must be clearly stated.
What does your policy say? If it gives employees vacation time, but is silent on whether that vacation time will be paid when employee quits or is discharged, you’re on the hook and must pony up.
While an Employee Handbook is not a contract, an employer may sometimes be bound by its terms. A wise employer will carefully vet the handbook to make sure its terms comply with the law, and that its policies reflect the employer’s intention. An experienced attorney can help with this process.
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By: Daniel A. Gwinn, Esq.