Dispelling the 10 Biggest Wage and Hour Myths: Part I

It seems like on a daily basis we receive a phone call from a client or prospective client who is confused about some aspect of wage and hour law.  Myths and urban legends abound in this area of the law.  Often passed on from person to person and company to company, the more they are repeated, the more believable they become.  Over the next 10 days, we will take aim at the 10 most frequently encountered myths with respect to properly compensating employees.  Please note that the commentary below is based solely upon federal and Pennsylvania law.

  1. Employees are entitled to payment for accrued but unused vacation, sick time, or PTO upon the termination of employment. Neither federal law nor Pennsylvania law requires employers to pay out accrued but unused vacation, sick time, or PTO upon termination of employment.  In Pennsylvania, this issue is dictated by policy and/or practice.  Whether or not an employee is entitled to such payment will be determined based upon the applicable employer policies.  It is perfectly acceptable for an employer in Pennsylvania to adopt a PTO, vacation, or sick leave policy that states “upon the termination of employment, employees will not be paid for any accrued, but unused leave (vacation, sick, PTO).”  Similarly, Pennsylvania employers can condition the payment of such accrued, but unused leave upon the employee satisfying certain conditions (e.g., termination was not for misconduct, 2-week notice of voluntary termination provided, etc.).

 Tune in tomorrow for wage and hour myth #2.