9th Circuit: Indefinite furlough triggers right to immediate vacation payout
In February 2022, Los Angeles federal judge Dale Fischer ruled in Hartstein v. Hyatt Corporation that California law did not require Hyatt Hotels immediately to pay the over 7,000 employees it furloughed/temporarily laid off in March 2020, the start of the COVID-19 pandemic, the value of their accrued but unused vacation time.
Judge Fischer reasoned that the furloughed employees were not entitled to that payout until Hyatt made the furlough a permanent layoff in June.
The ruling was based on two provisions of the California Labor Code. Section 201 says “[i]f an employer discharges an employee, the wages earned and unpaid at the time of discharge are due and payable immediately.” Section 227.3 says when an employer provides paid vacations, “and an employee is terminated without having taken off his vested vacation time, all vested vacation shall be paid to him as wages at his final rate. ...”
Click here to read the full article written by SCMV Shareholder Dan Eaton and published in The San Diego Union-Tribune.