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The federal Family and Medical Leave Act (FMLA) provides job security to an employee who is absent from work because of the employee’s own serious health condition or to care for a specified family members with serious health conditions, as well as for the birth of a child and to care for a newborn child, or because of the placement for adoption or foster care of a child with the employee.

Employees eligible for FMLA are entitled to 12 workweeks of leave in a 12-month “leave year.” An employee may take FMLA leave for any of the following reasons: (1) the serious health condition that makes the employee unable to perform the essential functions of the position; (2) the serious health condition” of a spouse, child or parent; (3) the birth of a child or to care for such child; or (4) the placement of a child with the employee for adoption or foster care.

Employers may require medical certification of the existence of a serious health condition. Further, FMLA leave is unpaid unless available paid time off is taken (e.g. vacation, paid sick time or paid personal time off) and/or unless disability beneftis are available.

Under a “use it or lose it” policy, an individual who does not use all of his or her accrued vacation pay by a particular time forfeits the right to be paid fro those days at a later date. The California Supreme Court held, however, that vacation pay vests as it is earned, and any vacation earned cannot be taken away. Vacation pay is, in effect, additional wages for services performed, the receipt of which is postponed. Thus, this “use it or lose it” policy is generally unlawful. Thus, upon termination, for instance, the employer must compensate the terminating employee for unused vested vacation time.

Vacation time is in many ways treated like wages under California law and is actually considered wages for the purposes of compensation. Thus, when vacation is earned during a period of employment (for example, two weeks of paid vacation annually) and the employee does not complete the period, California Labor Code section 227.3 requires compensation for a pro rata share of the unused vacation based on the percentage of the period completed.

Further, an employer may not force an employee to use accrued vacation time rather than serve out the term of his employment. Vacation pay that is not used continues to accumulate unless the vacation policy contains a “cap” on accruals. A “cap” precludes the employee from accruing additional vacation time after a specified amount has been accumulated.