In most states, private sector employers are not required to provide vacation, whether paid or unpaid, to employees. Therefore, employers have significant discretion in developing vacation and personal leave policies that best fit the needs of their workplace and employees.
If promised, vacation must be granted. Nonetheless, it is important for employers to understand that, if their practices, policies, or statements rise to the level of creating a “promise” of vacation, then the employer may create a binding legal obligation to provide vacation—even when state law would not otherwise require it to do so.
Payout of vacation at termination. This caution also applies to obligations to pay out accrued, but unused, vacation time at termination of employment.
If an employer provides paid vacation under a company policy or practice, New Hampshire law mandates that the employer pay employees for accrued, unused time. Vacation pay is included in wages due to an employee (NH Rev. Stat. Sec. 275:43).
Employers must also provide employees in writing or through a posted notice its employment practices and policies regarding vacation pay and other benefits (NH Rev. Stat. Sec. 275:49).
The notice must be clear and must cover all policies and practices in detail. An employer that does not put vacation practices and policies in writing is likely to lose a wage claim for vacation pay.
For additional information on final wage payments, please see the Paychecks
Clear policy language will control. Therefore, even when state law does not expressly require employers to provide vacation, employers should assume that their established policy will control.
For this reason, employers must ensure that vacation ...