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At my company we accrue vacation days per month. This means I will never be able to take a week off early in the year. I've been with the company for 3 years now, and my boss has no problem with it. However, HR is adamant that vacation cannot be taken until it is accrued (we have no "floating" days). I am curious, how does my employer benefit from vacation accrual for long time employees? Is it easier to levy this constraint on all employees instead of new hires? Or is this meant to encourage employees to not burn through their PTO in the beginning of the year?

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    Does not (at least some of the) leaves "carry over"? Usually, this is only a problem for the new joiners for the first year, then on, if you have unused leaves by end of the year, they carry over to next year, and you can use it as you wish. – Sourav Ghosh Jan 21 at 15:38
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    @JoeStrazzere Good point. That also happens where I am currently working. – Neo Jan 21 at 17:06
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    What happens to the days accrued for December? Do you just lose them? Does everybody have to go on vacation at the end of the year? – piet.t Jan 22 at 6:53
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How does my employer benefit from accruing vacation for long-standing employees?

This is really not so unusual. Where I work, it is the same way -- you have to earn it in order to use it. Each locale (state) will have different applicable laws, but here in the US it happens.

The benefit is pretty obvious, they don't want to risk loaning PTO out and then having the employee resign before they earn the PTO. Yes, in some cases they can pull the amount owed from your last check, but in some places the employer cannot do that. It is basically a protection mechanism for the company against a potentially sticky legal situation.

And to Joe's point in the comments on the question, you can try to work something out with your manager directly. This type of unofficial activity is quite common, especially for those who want or need to travel over seas where it doesn't make sense to go the distance for just a week.

Note: USA based answer and IANAL

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  • I do think it is that simple. The company just draws a line to which they can adhere under all circumstances. That way they don't have to try to exception process for a zillion requests. (eg You let Joe take vacation early, why can't I?) // The only other thing about this is if an employee can roll over vacation days. The company obviously doesn't want too many days to roll over, let's say not more than an employee earns in a year. That way an long term employee could take a week or two early in the year. – MaxW Jan 21 at 16:25
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    I think this answers half the question - from the context it sounds like they "reset" the hours at the end of the year instead of allowing carryover. The reason for this is similar, accumulated PTO is carried as a liability on the corporate books and they want to clear it out. Yes it's worse on the employees but clearly they don't care about that. The first part, the accrual, is normal, the second part, not being able to carry over accrued, is not. – mxyzplk Jan 21 at 16:52
  • Also, spme employers have a lag time for pay, where if you quit, they just deduct any unearned time from the final payout. – Old_Lamplighter Jan 21 at 17:28
  • @mxyzplk: It's really contextual. Where I'm from, our PTO is legally mandated (as a minimum amount) and therefore doesn't need to be accrued. You literally have to take it in that year, you even have to book your leave when you're unemployed. So you don't need to accrue it, however, you cannot carry it over (barring special circumstances). To me, it's the accruing that's "not normal and the not being able to carry over is "normal". – Flater Jan 22 at 16:56
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This sounds like a dumb policy on the company's end, I would recommend leaving some feedback about it to have them potentially review.

However to me it seems that it may be intentional; While not mentioned in this specific question, it would be suspicious to me if they also had expiration dates/times on your PTO in addition to making you wait to accrue it.

If so, the motivation would likely be to make it difficult for employees to fully use their PTO, making them theoretically more productive/available, while also reducing company costs in the event that PTO accrues and doesn't get used, which in many states they have to pay out to an employee when they leave.

If it doesn't expire and they merely make you wait to accrue it, it may just be a poorly thought out policy, or that they are sticking to it for 'legal' reasons while silently acknowledging that you can work out whatever unofficial plan with your own manager that you're both comfortable with.

My question would be how this escalated to HR - Did you submit a request to your boss, and they 'told' you that HR had a problem with it, but that they didn't? This may just be a soft way of your boss denying your request without having to confront you about taking too much time off / too soon / it just not being convenient for them, and scapegoating HR for it with what is an easily defendable excuse that it's a policy.

The reason I mention that is in most of my jobs, whether I take PTO is usually only discussed between me and my manager - it may get reported onto a timesheet system that they use for tracking, but I can't imagine HR getting involved unless there was some dispute over my manager rejecting the request arbitrarily and me complaining

Something that may add some context to what the company may be driving at, which partially makes up my cynicism here, is other PTO scams / schemes, such as:

  • "unlimited PTO" where employees don't "Earn" PTO but have to ask for it and are pressured out of using it
  • PTO days that are earned but expire
  • complicated approval processes for PTO
  • blackout windows

etc.

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At my company we accrue vacation days per month.

This sounds a bit unusual to me. Usually it's weekly or resetting within a period of time usually at the FY start.

This means I will never be able to take a week off early in the year. I've been with the company for 3 years now, and my boss has no problem with it.

I'm thinking you might want to check your local, city, or state laws in regard to time off. If you cannot take vacations longer than a week in the early part of the year, then that sounds horrible.

I am curious, how does my employer benefit from vacation accrual for long time employees?

The thing is when you have vacation hours, that's considered "earned" hours. So if you have 80 hours of vacation, that's 80 hours that they have to pay you. Only way they can not pay that is if you get fired or don't put in a notice period.

However.... I think this isn't what you're asking. You're asking how your employer benefits within the current scheme that you fall under. You ear hours on a monthly basis so that means you have to wait a very long time to save up your vacation time. This sounds like a cheap way to discourage employees from taking any time off or extended time off. This means you can only take a day off here and there or otherwise you're going to run into issues where you cannot even do that.

My thought is the vacation scheme sounds horrible. As I said earlier you best check your local laws and see if there is anything in regard to this. My guess is not so your next best thing is to quit if you can't take necessary time off except at the end of the year.

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  • The laws about paying out earned but unused vacation vary by state, at least in the US. Depending on where you are, employers may be required to pay earned vacation upon separation for any reason, or they may have no requirement at all to pay out earned but unused vacation at the time of separation. In many states, it's dictated entirely by the company's own policy. It's possible that you could quit or get fired or laid off with 80 hours of accrued vacation, and get paid for none of it. – Nuclear Hoagie Jan 21 at 19:22

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