Can an Ohio company change it’s vacation payout policy for exiting employees after their start date in order to no longer pay out unused vacation?
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Can an Ohio company change it’s vacation payout policy for exiting employees after their start date in order to no longer pay out unused vacation?
During the hiring process, the company
presented a policy document that I still have
that specified the payout of any earned but
unused vacation upon separation. A few years
ago they changed the policy without notifying
the employees to no longer payout unused. Now
that I am leaving, is the company required to
honor the original policy? This is an Ohio
company and the policy documents are not
signed. Thanks
Asked on July 8, 2019 under Employment Labor Law, Ohio
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 5 years ago | Contributor
A company can change its vacation payout policy (though if they do, they generally have to give you some reasonable chance to either use the days or else to, if you wanted, quit/resign and be paid out per the old policy) but they can only do so on notice: that is, to be effective, employees must be told of (given notice of) the policy change, generally in writing, and the new policy is only effective after the notice. If they never notified employees--i.e. they never provided notice prior to you leaving employment--they have to honor the prior policy. But if you received notice while still working there, even if you did not receive it when the policy was first changed, then subject to giving you some chance to either use the days or else quit and cash out the days, they can change it: they are not locked into the policy forever, but can change it on proper notice.
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