If promised, vacation must be granted. Although no Illinois law requires private sector employers to provide employees with vacations, paid or unpaid, most employers do offer their employees some version of vacation. Thus, it is important for employers to remember that if they “promise” vacation, they may be legally bound to provide it—and that a binding promise does not require embodiment in a formal employment contract.
Illinois courts have ruled that an employer's assurance of paid vacation time, whether made in an employee handbook or given orally or simply understood as a matter of common practice, may constitute an implied contract, which is binding and enforceable. Therefore, employers should review handbooks, policy statements, and promises carefully to ensure that they are accurate and current. If not, they should be changed, and employees must be notified in advance of the change.
Accrual method. Employers are free to devise their own system for vacation accrual—for example, on a monthly or pay-period basis or upon completion of a 6-month or 12-month period. It is important to be clear and unambiguous when drafting such policies. However, whenever an employment contract or an employment policy provides for paid vacation earned by length of service, vacation time is earned pro rata as the employee renders service to the employer. Therefore, the employee will be entitled to the pro rata share of vacation at the time of termination.
For new employees, the employer may set a reasonable period of time in which no vacation is earned. However, if such a policy is established for new employees, the employer must demonstrate that the provision is not a subterfuge to avoid payment of vacation actually earned by ...