Fired worker gets paid for unused vacation, despite company’s policy
May 14, 2009 by Sam NarisiPosted in: Benefits Law, Latest News & Views, Terminations
Employers who follow their own policies regarding vacation time are usually safe. But here’s a case where a court forced an employer to make the payment to an employee who was fired for conduct — even though the company’s policy said he wasn’t owed anything.
The company’s handbook said that employees fired for “gross misconduct” would not receive pay for earned but unused vacation time. The term “gross misconduct” was not defined.
One employee was fired after he failed a mandatory drug test. He did not receive any vacation pay.
He sued, claiming a failed drug test didn’t reach the level of gross misconduct and demanded a payout for the leave he didn’t use.
The court agreed. Since the company didn’t explain what conduct it was referring to, the judge tipped the scales in the employee’s favor and said “gross misconduct” refers to actions that are “intentional, wanton, willful, deliberate, reckless or in deliberate indifference to an employer’s interest.”
And, according to the court, failing a drug test didn’t make the cut. The employee was awarded his payout.
The lesson: Be careful about using terms that are open to interpretation without clearly defining them. If the handbook had simply said, for example, that employees forfeit their paid leave if they’re fired for breaking company policy, the court battle could likely have been avoided.
Cite: Lang v. Quality Mold.
Tags: gross misconduct, handbook, paid leave, vacation
May 15th, 2009 at 12:12 pm
I see. So knowing that your employer does drug testing, not caring, and getting high anyway is NOT considered “deliberate” and “intentional”? I mean, I understand that the company could have re-worded the policy, but for a court to interpret the failed drug test that way is disappointing.
May 15th, 2009 at 3:11 pm
Okay, this employer ran a ‘drug-free workplace’. Because it was, the employee had to take a pre-employment drug test and entered into employment with the full understanding of this condition. Coming to work under the influence broke company policy and if the vacation policy states that there is no payout due to misconduct, then so be it. The courts decision is ridiculous – it’s condoning the employees’ lack of responsibility to abide by the ‘drug-free’ guidelines.
So how would this situation be received if the employee had endangered/injured another employee or customer because they were under the influence of alcohol or drugs? Would the court consider that misconduct? Or split hairs over the meaning of misconduct? His attorney and the court seemed not be concerned about holding the employee accountable for coming to work in a sober state….instead the court focused only on the terminology and how it was presented in a handbook. Pretty sad.
May 21st, 2009 at 1:18 pm
First of all, the employee should have been discharged for failing the company Mandatory Drug Testing policy and not for “gross misconduct”. The company involved needs to update the verbiage in the Employee Handbook (as should every company due to the new Administration) and be extremely specific when it comes to “grounds for immediate termination” and the vacation pay policy in regards to termination. California is a very employee friendly State. You need to think of every scenerio that may come into play and address it in the form of a written policy.
By the way, the Judge is wrong morally…but correct due to the company written policy. No gray area please…