Human Resources News & Insights

Fired worker gets paid for unused vacation, despite company’s policy

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.

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  • Melony

    “intentional, wanton, willful, deliberate, reckless or in deliberate indifference to an employer’s interest.”

    Are you kidding me! Failure to pass a required drug test would definitely be under “my definition” of the above. What could that judge be thinking? Maybe he has been smoking a little crack himself.

  • Alex S.

    Talk about “gross misconduct”….I think the judge is a bit “guilty” of that himself. I would think a failed drug test would be “intentional, wanton, willful, deliberate, reckless and a deliberate indifference to an employer’s interest” and also to the employee’s interest as well. This judge’s decision shows that “the inmates are definitely in charge of the asylum” when this type of behavior gets this type of results.