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Michigan Vacations: What you need to know

If promised, must be granted. Although no Michigan 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. In Michigan, if an employer has agreed in writing to grant paid vacation, it must be provided until the policy is changed in writing. Further, a binding promise does not require embodiment in a formal employment contract. Michigan courts have ruled that, under some circumstances, an employer's assurance of paid vacation time given in an employee handbook, given orally, or simply understood as a matter of consistent practice, may constitute a binding and enforceable contract.
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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. If the policy is intended to ensure that employees work the entire accrual period to earn their vacation days, it should state clearly that employees will not be entitled to pro rata payment if they leave partway through the period. Remember that any vagueness in the policy is likely to be construed against the employer.
Vacation pay due at termination? Michigan's definition of “fringe benefits” includes paid vacation. An employer promising in writing to make payments to an employee vacation plan is required by law to do so. Also, if the policy is written, upon the employee's termination the employer must pay for earned but unused vacation days. The written ...

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