COVID-19 Alert   We have changed our procedures for COVID-19.   Learn More
What to consider when laying off employees due to COVID-19. Learn More

  • Sabbatical or Vacation? You Tell Me.

    Most employers have some sort of vacation policy.  Under California law, if an employee has unused accrued vacation at the end of his/her employment, the employer must pay out the unused but accrued vacation.  Several companies also offer a sabbatical program, which typically offers a longer period of paid time off after a particular length of employment.  While traditionally sabbaticals were designed to allow professors and the like to gain new experiences and knowledge that would enhance the reputation of the colleges offering the sabbaticals, as private non-educational employers began offering sabbatical programs employees were allowed to take sabbaticals merely to “recharge their batteries.”  Unlike vacation plans, an employer can have a “use it or lose it” sabbatical policy.

    So, what’s the difference between a sabbatical and vacation, and can employers simply call their vacation plan a sabbatical in order to avoid the end-of-employment payment required by vacation plans?  That’s what Paton v. Advanced Micro Devices, Inc. had to decide.

    After going through a short history of the sabbaticals, as well as several DLSE opinion letters on the issue, the court announced a four-part test to determine whether a sabbatical really is a sabbatical:

    1. The sabbatical leave should be granted infrequently and intended to retain experienced employees who have devoted a significant period of service to the employer.  The court suggested a 7-year rule, allowing employees to take sabbatical every 7 years, but acknowledged that greater or shorter periods might be appropriate depending on industry standards.
    2. The length of sabbatical should be longer than that “normally” offered as vacation. Since regular vacation time may be used for rest, a sabbatical ought to provide the extended time off work that regular vacation does not. The court did not indicate what length of time would suffice, but in Paton the employee was entitled to a four-month sabbatical and the court believed there was sufficient question as to the validity of the sabbatical policy for a jury to decide the issue.
    3. The sabbatical must be in addition to regular vacation.  According to the court, [b]ecause an employer could offer a minimal vacation plan and reward senior staff with sabbaticals as a way to avoid the financial liability of a more generous vacation plan, the employer’s regular vacation policy should be comparable to the average vacation benefit offered in the relevant market.”
    4. The sabbatical program should incorporate some feature that demonstrates that the employee taking the sabbatical is expected to return to work for the employer after the leave is over. This was an element implied by the Labor Commissioner, but not explicitly enunciated as a requirement for a valid sabbatical program.

    The court  rejected the idea that the sabbatical must be for specified purposes (i.e., continued education, career development, etc.) and be limited to upper management (an element previously identified by the Labor Commissioner as necessary for a true sabbatical.

    Another interesting tidbit, while many recent decisions refuse to follow Labor Commissioner opinion letters, the Paton court acknowledged that the court is not required to reject those opinions.  Unfortunately, employers and employees won’t know which opinions are correct and which are not good law until the courts review each opinion letter.

    If your company uses sabbaticals as a way to reward long-term employees, speak with an employment attorney to ensure the company policies follow the law.

    The Law Office of Phillip J. Griego
    95 South Market Street, Suite 520
    San Jose, CA 95113
    Tel. 408-293-6341
     
    Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego.
     
    Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.
     
    Your use of this blog does not create an attorney-client relationship between you and the Law Office of Phillip J. Griego. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and the Law Office of Phillip J. Griego cannot guarantee the confidentiality of anything posted to this blog.Phillip J. Griego represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

  • Leave Entitlements

    I was looking for some information regarding the various leave laws that employers must consider, and came across a guide from the Department of Fair Employment and Housing.  It is a fairly good summary of most of the various leave laws impacting companies doing business in California.  I noticed it does not discuss leaves of absence under USERRA and other available leaves under California’s Military and Veterans Code, but it is still a good summary.

    California employers and employees should ensure they are familiar with the various rights and obligations imposed by the leave laws impacting their work and should review their handbooks to ensure they are up to date.

    The Law Office of Phillip J. Griego
    95 South Market Street, Suite 520
    San Jose, CA 95113
    Tel. 408-293-6341
     
    Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego.
     
    Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.
     
    Your use of this blog does not create an attorney-client relationship between you and the Law Office of Phillip J. Griego. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and the Law Office of Phillip J. Griego cannot guarantee the confidentiality of anything posted to this blog.Phillip J. Griego represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

  • Requiring Use of Accrued PTO for Exempt Employee Absences

    Jim posted the following:

    I work for a large non-profit in Southern California. At our Management Team Meeting a couple of days ago, the Executive Director informed us (exempt staff) that effective immediately, if we take off early for a medical appointment, we must charge those hours against our sick leave hours. We were also informed that if we come in to work for a partial day (for example working less than a full day to get work done before heading off for vacation), we must charge whatever hours we don’t work, against our Personal Time Off.

    As exempt staff, part of our job is to attend evening and weekend events (in addition to hours in the office). Is this legal? Does this mean that we are no longer exempt, but hourly?

    It should first be noted that if any of the time is taken off under the Family Medical Leave Act (FMLA) or the California Family Rights Act (CFRA), the employer can deduct the hours from your pay without risking losing the exemption. This is true because FMLA and CFRA specifically provide that the time off is “unpaid.”

    If an otherwise exempt salaried employee absents himself or herself for a full day or more on personal business, such absence may be deducted on a pro rata basis from the salary owed. A deduction under these circumstances does not affect the salaried exempt worker’s exempt status.

    The state Labor Commissioner has taken the position that “If an exempt employee performs any work during the work day, no deduction may be made from the salary of the employee as a result of what would otherwise be a ‘partial day absence.’”

    However, in 2005 a California Appellate Court decided Conley v. PG&E (2005) 131 Cal.App.4th 260. One of the issues decided was whether an employer can deduct for partial day absences of four hours or more from an employee’s vacation pay bank, when the employee is salaried exempt. Under PG&E’s vacation pay policy, employees could take vacation in increments of 4 hours. The court held that under the facts of PG&E’s vacation pay policy, where the company only deducted for absences of 4 hours per day or more, there was nothing in California law which prohibits this practice. This enforcement policy is consistent with that of the U.S. Department of Labor. (See, Wage and Hour Division, U.S. Department of Labor, Opinion Letter dated July 21, 1997).

    Based on Conley, the Labor Commissioner adopted the policy that “If a sick leave plan provides for a vested right to wages, as is the case with vacation and PTO plans, the holding in Conley is applicable and deductions from accrued sick leave may be made only for absences of at least 4 hours in duration. If a sick leave plan does not establish a vested right to wages, deductions from sick leave for increments of less than 4 hours continue to be permissible to the extent that such leave credits exist at the time of the partial day absence.”

    Assuming the employer provides paid PTO, the employer can require exempt employees to charge time off against their accrued PTO. Once that PTO is exhausted, the employer can reduce the employee’s salary for partial day absences in 4-hour increments without risking losing the exemption provided the employer’s PTO policy allows employees to take PTO in 4-hour increments. If the time off is less than 4-hours, or if the employer’s policy only allows PTO to be taken in full day increments, the employer cannot reduce the employee’s salary. The employer may be able to deduct the time from future PTO that has not yet accrued, thereby causing the employee to go into a negative PTO balance. The employer may have a difficult time recouping the negative PTO.

    The Law Office of Phillip J. Griego
    95 South Market Street, Suite 520
    San Jose, CA 95113
    Tel. 408-293-6341
     
    Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego.
     

    Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.

    Your use of this blog does not create an attorney-client relationship between you and the Law Office of Phillip J. Griego. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and the Law Office of Phillip J. Griego cannot guarantee the confidentiality of anything posted to this blog.

    Phillip J. Griego represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.