Vacation Float: Managing (And Recouping) Unearned Vacation Time

Summertime is vacation time. And vacation time means headaches for employers who engage in vacation float. Vacation "float" is the practice of advancing vacation to employees before they actually accrue it under an employer's vacation policy. So the question becomes, if you allow an employee to take vacation time the employee hasn't actually earned, how do you get the value of that time back if the employee leaves before "repaying" it?

Today's staggering rate of employee mobility creates compliance challenges for employers with generous paid time off programs. This problem is particularly vexing for employers in states like California and Massachusetts that classify accrued vacation as an earned wage. Like an employee's paycheck, vacation time has an actual cash value, and once that cash is provided, it can't be recouped – or can it?