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Employee Rights    

EMPLOYEES’ RIGHTS WHEN LEAVING EMPLOYMENT

     In the current climate of economic uncertainties, lay-offs and terminations are happening all too frequently. It is bad enough to lose one’s job; it gets worse when an employee is not provided what is rightfully due him or her upon leaving the workplace.

     Knowing your rights upon the end of an employment relationship may help you weather the transition of being in between jobs. The following provides some helpful guidelines:

     First: Make sure that the employment relationship has ended and there is no misunderstanding about this. Employment can end by resignation or lay offs. An employee can also be “discharged.” “Discharge” includes involuntary termination. It also includes release of an employee when the employee has completed a specific job assignment or the time duration for which the employee was hired is ended.

     Second: Consider any payment that might be due to you upon termination. Your employer may owe you unpaid wages for the days you have worked prior to your discharge. Has your employer paid you for work performed beyond 8 hours, or for work done during missed lunch breaks? If you were eligible for vacation, you may also be owed payment for vacation time you did not take.

     Third: If any payment is due, your employer must immediately pay all compensation due and owing to you. The employer should pay you “at the place of discharge.” If you quit (this means you were not “discharged”), you should be paid at the office or agency of the employer in the county where you worked.

     If you are owed money, the employer has the obligation to make sure that you receive your payment. If the employer tells you that they will mail the check, you must consent to such an arrangement. If the employer sent the final paycheck by mail without your consent, and the check was not received, it is considered that no payment has been made. You may also authorize the employer to pay the wages into your bank account. If this is the case, the employer should deposit the amount due into your account.

     If you resigned from work, the employer must pay all compensation due and owing within 72 hours of the resignation. If you gave more than 72 hours' notice of resignation, then all compensation due and owing must be paid on the last day of work.

     If an employer willfully fails to pay “without abatement or deduction” wages due to an employee who quits or is discharged, the employee's wages continue as a penalty until paid, for up to 30 days (this is called “waiting time penalties”). Unpaid wages accrue on a daily basis, not only on days that the employee might have worked, but also on nonworkdays. Hence, if the employee is regularly paid $120 per day, the employer may be held liable to pay up to $3,600 in penalty for not paying the terminated employee on time.

     However, the above requirements as to time for payment do not apply to:

       (1) Employees covered by collective bargaining agreements: Where employees are subject to a collective bargaining agreement providing for the time of payment of wages, the terms of the collective bargaining agreement control over any contrary requirements of the California Labor Code.

       (2) “Seasonal laborers”: Employers may hire persons in California to perform services outside the state for more than one month and agree to pay them solely upon termination of their employment, rather than at fixed intervals

     Severance Pay
     California law does not require that an employer provide severance pay to an employee. But where an employment agreement provides for unconditional severance pay, such payments are arguably “wages” and hence must be paid immediately on discharge or within 72 hours after resignation.

     Vacation Pays
     Vacation pay is treated the same as all other forms of compensation at termination. This means that accrued vacation pay must be paid to the employee immediately upon termination and within 72 hours of an employee's resignation. “Use it or lose it” vacation pay policies are illegal. The employer must compensate the terminated employee for unused vested vacation time.

     An employer is not allowed to forfeit any vested vacation time upon an employee’s termination. Because vacation pay is a form of deferred wages for services rendered, a proportionate right to a paid vacation “vests” as the labor is rendered. Once vested, the right is protected from forfeiture. Employer “buy-back” of accrued but unused vacation pay must be at the employee's regular rate of pay (including bonuses and daily meal allowances). A California court has held that it was unlawful for an employer (buying back accrued but unused vacation) to pay $64 per day to an employee whose regular rate was more than $8 per hour.

     The end of an employment relationship may be regrettable but it should not necessarily become an ordeal. Of course, some situations are more complex and may require further analysis. If an employee thinks that his or her rights have been violated during a resignation, lay off or discharge, it would be smart for that employee to consult with a knowledgeable and experienced employment attorney to protect his or her rights.

© Law Offices C. Joe Sayas, Jr.