Although no Massachusetts 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 are legally bound to provide it--and that a binding promise does not necessarily require embodiment in a formal employment contract. Massachusetts courts have ruled that under some circumstances, an employer's assurance of paid vacation time, whether made in an employee handbook, given orally, or simply understood as a matter of common practice, may constitute an implied contract, which is binding and enforceable.
The Attorney General's Division of Fair Labor and Business Practices has issued an advisory on employer vacation policies. The advisory clarifies the well-established statutes, noting that employers are free to devise their own system for vacation accrual. There are several different commonly used options:
• Upon completion of a 6-month or 12-month period
The advisory also clarifies that accrued vacation may not be forfeited, nor can the accrual policy result in forfeiture. It is important to be clear and unambiguous when drafting such policies. Remember that any vagueness in the policy is likely to be construed against the employer.
Employers may cap the amount of vacation allowed to be earned and may institute “use it or lose it” policies, but such policies must be written and clear. Also, employees must be provided with plenty of notice so that they have time to use accrued vacation. Changes to the policy must be made prospectively ...