In the US, some employers do pay out vacation, but many don’t, because there’s no law requiring them to do so. It’s perfectly legal to offer literally zero vacation days.
California is actually one of the states that require pay out of unused PTO. I believe MA, CO, and LA do as well, Im not sure of all of them. More than half don’t require it, in those states it’s company dependant.
The really cool thing is that my nationally operating employer has offices in NY and CA, and my team has members in both NY and CA. And we in NY don’t get paid out minimum unused vacation, while the people on my team in CA, who I work with every day, and who do the same job, in the same company, in the same country, do get paid out.
Our CEO (who recently was let go with a golden parachute and will never have to work again) was asked about this policy at an all-hands, and he replied, “We comply with local laws.”
Since I live in Massachusetts, I was curious to learn more. According to this site, you are correct about my home state, and quite a few others as well!
Aside from this, at least in my state, if you opt to cash out your vacation days without taking them, they get taxed at a higher rate. I used to tell my teams, “If you take your vacation days instead cashing them out, you get more money after taxes and you don’t have to be here, so please just take your vacation time.”
I’m pretty sure they just get withheld at a higher rate.
It’s the same amount of money, and the tax rate is calculated on total income (with a bunch of bullshit to make it more complicated for minimal reasons), but getting paid for unused vacation days means that you got a much higher total amount of cash that week, and so bonus checks have more money taken out for taxes because projecting that week’s checks out to a year at $2000 instead of $1500 would put you in a different tax bracket.
But at the end of the year it’s just your total income used to calculate the actual amount owed, so your number would be the same. (Ignoring that it’s progressive and you earned 40 more hours worth of money). So most of the time that difference in withholding is basically just a bigger refund or less owed.
Yup, I’ve never had an employer that pays out vacation. My dad did, and he also had a pension, so I know unicorns at least exist.
Mine just rolls over up to 5 days, and that’s it. No payout or anything, though I think if you get laid off, it needs to be part of the severance package (but if you quit, you get nothing).
It depends. Usually if you leave a job and have any unused vacation left over, they have to pay you for that time. There’s a catch though, they do not have to let you carry over your vacation from year to year (use it or lose it), and/ or they can set a cap of how much vacation you can have accrued. In the latter, you can either lose any vacation over that cap, or some employers might be “kind” and let you convert excess vacation into sick time. Sick time does not have to be paid out when you quit.
My employer, for example, allows us to accrue up to 240 hours of vacation time; anything above 240 gets converted to sick time. We can accrue as much sick time as we want. So long as we remain employed, it never expires. We can also apply our sick time toward our retirement.
At my company, it’s not unheard of for employees to stick around for 20+ years before retiring. If you bank all of your sick time, you can apply toward your retirement date and retire up to three years early. And, a lot of people when they retire will have enough vacation available that they can take a month off before officially retiring; and the company does not stop them.
Also it should be noted, I work in the public sector and am considered a state employee. So that helps.
Sick time can be used when you’re sick, have a doctor’s appointment, or need to take care of family members who are sick or have doctor’s appointments. It is time given to the employee so that they do not have to burn up their vacation time.
Granted, if you run out of sick time, you either have to use vacation, or you take unpaid time off. My state has a sharing system, where other employees can give you some of their sick time. This is usually for extreme circumstances, such as on-going long-term care (e.g., chemotherapy) and the person is out of both sick and vacation time.
I’m sure it sounds weird and possibly convoluted. It probably is weird and convoluted. Employers here don’t trust their employees, so they feel the need to treat us like children. Some employers even require employees to get doctors notes excusing their absence or tardiness.
I’m sure there are some people who would take advantage of any kind of unlimited/untracked sick time. I’m not naive to think everybody would work in the honor system. I think that employers here take it to the extreme, and decided that treating everybody this way was easier than working with those who abuse the system. Might be because we are a litigious society in America; a lot of people looking for any excuse to take someone to court for money.
I can only speak for the UK, but it’s rarely an entitlement to have annual holidays paid, rather an option.
My currently employer will pay out if you’ve demonstrated that you’ve tried to take leave through the year and it’s been declined for whatever reason - they’ll pay the remaining balance. It’s done that way to discourage people from hoarding their days off to try and get a monster payday at the end of it, rather than work themselves into a breakdown from not having any time off work which I can see the benefit of but still not entirely sure it should be at the discretion of the employer.
That, and taking the holiday days is effectively tax free. If you take a week off on a 40hr per week contract, then you get 40hrs worth of time off. If you get it paid, then you’ll get at least 19pc of the leave pay going as tax, depending on where in the UK you are.
I’ve seen previous employers going with the flow and allowing employees to take their leave as paid if they want to, but effectively buying the leave pack at two-thirds rate for payment.
An old place I used to work for went halfway, allowing the carrying of ten days leave into the next year, but anything above that is forfeit.
I’m in Canada. For regular employment there are a minimum of 3 paid weeks holidays. Vacation pay comes out of every paycheck so it’s an entitlement. There is vacation hoarding, but mostly to take a while summer off or something. Nobody wants to get paid out for accumulated vaycay because the tax hit is monstrous.
Well they got paid out for them right? Right?
In the US, some employers do pay out vacation, but many don’t, because there’s no law requiring them to do so. It’s perfectly legal to offer literally zero vacation days.
I feel sorry for Americans
Your thoughts and prayers are all we need
But we also accepts Likes and Subscribes.
Edit: Just don’t ring the bell. We’ve already lost two of them…
Well I mean it’s not like the government is going to give us anything actually useful.
Americans do, too. Well, the smart ones feel sorry.
Will you adopt me? I just need a small spot on the floor to sleep, I’m already house trained.
California is actually one of the states that require pay out of unused PTO. I believe MA, CO, and LA do as well, Im not sure of all of them. More than half don’t require it, in those states it’s company dependant.
The really cool thing is that my nationally operating employer has offices in NY and CA, and my team has members in both NY and CA. And we in NY don’t get paid out minimum unused vacation, while the people on my team in CA, who I work with every day, and who do the same job, in the same company, in the same country, do get paid out.
Our CEO (who recently was let go with a golden parachute and will never have to work again) was asked about this policy at an all-hands, and he replied, “We comply with local laws.”
Since I live in Massachusetts, I was curious to learn more. According to this site, you are correct about my home state, and quite a few others as well!
Aside from this, at least in my state, if you opt to cash out your vacation days without taking them, they get taxed at a higher rate. I used to tell my teams, “If you take your vacation days instead cashing them out, you get more money after taxes and you don’t have to be here, so please just take your vacation time.”
I’m pretty sure they just get withheld at a higher rate.
It’s the same amount of money, and the tax rate is calculated on total income (with a bunch of bullshit to make it more complicated for minimal reasons), but getting paid for unused vacation days means that you got a much higher total amount of cash that week, and so bonus checks have more money taken out for taxes because projecting that week’s checks out to a year at $2000 instead of $1500 would put you in a different tax bracket.
But at the end of the year it’s just your total income used to calculate the actual amount owed, so your number would be the same. (Ignoring that it’s progressive and you earned 40 more hours worth of money). So most of the time that difference in withholding is basically just a bigger refund or less owed.
Deoends on the state whether or not accrued vacation must be paid out or not.
We in Europe measure who has bigger vacations, while Americans discuss wether they should have any. What a wild continent.
Yup, I’ve never had an employer that pays out vacation. My dad did, and he also had a pension, so I know unicorns at least exist.
Mine just rolls over up to 5 days, and that’s it. No payout or anything, though I think if you get laid off, it needs to be part of the severance package (but if you quit, you get nothing).
It depends. Usually if you leave a job and have any unused vacation left over, they have to pay you for that time. There’s a catch though, they do not have to let you carry over your vacation from year to year (use it or lose it), and/ or they can set a cap of how much vacation you can have accrued. In the latter, you can either lose any vacation over that cap, or some employers might be “kind” and let you convert excess vacation into sick time. Sick time does not have to be paid out when you quit.
My employer, for example, allows us to accrue up to 240 hours of vacation time; anything above 240 gets converted to sick time. We can accrue as much sick time as we want. So long as we remain employed, it never expires. We can also apply our sick time toward our retirement.
At my company, it’s not unheard of for employees to stick around for 20+ years before retiring. If you bank all of your sick time, you can apply toward your retirement date and retire up to three years early. And, a lot of people when they retire will have enough vacation available that they can take a month off before officially retiring; and the company does not stop them.
Also it should be noted, I work in the public sector and am considered a state employee. So that helps.
Sounds like teaching.
Why would anyone want to get sick? It it is another american thing?
Sick time can be used when you’re sick, have a doctor’s appointment, or need to take care of family members who are sick or have doctor’s appointments. It is time given to the employee so that they do not have to burn up their vacation time.
Granted, if you run out of sick time, you either have to use vacation, or you take unpaid time off. My state has a sharing system, where other employees can give you some of their sick time. This is usually for extreme circumstances, such as on-going long-term care (e.g., chemotherapy) and the person is out of both sick and vacation time.
I’m sure it sounds weird and possibly convoluted. It probably is weird and convoluted. Employers here don’t trust their employees, so they feel the need to treat us like children. Some employers even require employees to get doctors notes excusing their absence or tardiness.
I’m sure there are some people who would take advantage of any kind of unlimited/untracked sick time. I’m not naive to think everybody would work in the honor system. I think that employers here take it to the extreme, and decided that treating everybody this way was easier than working with those who abuse the system. Might be because we are a litigious society in America; a lot of people looking for any excuse to take someone to court for money.
Anyway, I’ll answer any other questions you have.
It sounds slightly wierd, shlightly convoluted, but mostly inhumane in Europe.
I’m not sure if I have enough questions. Is there a state with functioning labour law, healthcare and welfare systems?
I can only speak for the UK, but it’s rarely an entitlement to have annual holidays paid, rather an option.
My currently employer will pay out if you’ve demonstrated that you’ve tried to take leave through the year and it’s been declined for whatever reason - they’ll pay the remaining balance. It’s done that way to discourage people from hoarding their days off to try and get a monster payday at the end of it, rather than work themselves into a breakdown from not having any time off work which I can see the benefit of but still not entirely sure it should be at the discretion of the employer.
That, and taking the holiday days is effectively tax free. If you take a week off on a 40hr per week contract, then you get 40hrs worth of time off. If you get it paid, then you’ll get at least 19pc of the leave pay going as tax, depending on where in the UK you are.
I’ve seen previous employers going with the flow and allowing employees to take their leave as paid if they want to, but effectively buying the leave pack at two-thirds rate for payment.
An old place I used to work for went halfway, allowing the carrying of ten days leave into the next year, but anything above that is forfeit.
As always, the devil is in the detail.
I’m in Canada. For regular employment there are a minimum of 3 paid weeks holidays. Vacation pay comes out of every paycheck so it’s an entitlement. There is vacation hoarding, but mostly to take a while summer off or something. Nobody wants to get paid out for accumulated vaycay because the tax hit is monstrous.