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resignation and getting paid for unused vacation time?

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What is the name of your state (only U.S. law)? Ohio

Here's the quick question. Is there a state or federal law requiring an employer to to pay a departing employee for unused vacation time? Or is it determined by individual contract or company policy?

Here's why I ask if you need more details. I have been part owner of a business and we sold to a larger business effective Jan. 1, 2018, the new owners business is based in another state and they are not planning to move any of their personnel to our facility. I have decided to retire and am planning on leaving June 1st, I am currently under no contract with the new owners so am an "at will" employee with twenty eight years of service. During the sale of the company some stipulations of the purchase agreement were I had no "unused vacation or expenses due", and this was the case since the agreement was being signed in Dec. of 2017. Another stipulation was all future employment contracts were discontinued and existing ones were void. Our company employee handbook policy is vacation time is based on the calendar year, so effective Jan. 1st I was back at thirty days vacation to use before the end of the year, that is time earned as detailed in our company handbook. Also our policy from the handbook has always been to pay a departing employee for any unused vacation time, the policy being vacation was earned the previous year.

So.....the new owners have said they are leaving the company to operate just as it has been (but of coarse they aren't), I asked for a copy of the parent companies employee handbook but nothing was ever supplied and we continue to operate using our old handbook as policy. Judging by the way the new owners are handling things I have a bad feeling they will try NOT to pay me for any unused vacation time when I leave, unless they are obligated under the law. BUT...as a case president we terminated an employee mid January and did pay him his three weeks of vacation time, but I am not sure the new owners even know about that but my leaving will not go unnoticed.

I really don't want to get tied up in litigation, the easy thing would be to delay my departure and focus on using all my days then resign. But financially what I would like to do is direct that unused vacation time money to fully fund my 401K and HSA account for the 2018 calendar year.

Back to the quick question....company policy or law?
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Senior Member
You were an owner of the company, you really should have made this part of the negotiations.

Are they aware of your retirement date? You should consider asking them directly if they are aware.


I'm a Northern Girl
Is there a state or federal law requiring an employer to to pay a departing employee for unused vacation time? Or is it determined by individual contract or company policy?

There is no such Federal law - state law rules in this instance. In Ohio it depends on the employer's policy.


Senior Member
It might be street smart to use it up without raising too many red flags or asking unnecessary questions...debating of the company carryover practice in context of contract language you post may not be slam dunk in your favor...and besides if they fire you you may well qualify for UC ..if you meet rest of the eligibility rules. As far as I know , vacation does not vest by law in Oh ..the stipulation you signed might be read two ways...and there is some ambiguity as to new vs old policy.. so why go there. Do NOT early announce any departure date ..that's another problem area. should they chose to accept it on the spot or early.

Me, I'd get it used up sooner than later lest new owners issue a policy " clarification "

I've seen folks leave lots and lots on the table because they were not street smart ...not smart to tempt fate.
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