When it comes to the benefits that today's employees have come to expect from their employers, a vacation policy is right up there with medical coverage. Companies with a standard vacation policy are sending the right message. They're showing employees they understand that everyone needs a day off sometimes, whether for personal reasons or just to recharge. If you don't offer a vacation policy, you're at a distinct disadvantage when it comes to attracting top performers. Know vacation policy key terms to get some insight into this popular employee benefit.
Fair Labor Standards ActThe Fair Labor Standards Act, also known as the FLSA, is a federal law providing minimum wage and overtime pay standards for government and private sector employees. Whether the federal government requires private businesses to pay vacation time has been an issue of ongoing concern among companies in the United States.
US Department of Labor page to find out whether and how the FLSA impacts a company's vacation policy.
Vacation deprivationVacation deprivation is a term that describes a distinctly American habit. Studies show that many workers in the United States do not use all of their earned vacation time and that they take fewer vacations than their counterparts abroad.
Vacation payVacation pay is any amount paid to employees while they are on vacation. Vacation pay is a concern of businesses that allow employees to take their vacation in daily increments.
Unpaid vacation timeThe issue of unpaid vacation time refers to an employer's policy on whether it reimburses employees who did not take all of their earned vacation over a given time period.
State of California's Department of Industrial Relations offers some helpful insight into this key issue. Find out how, in some states, an employer's written vacation policy is used to determine whether it must provide unpaid vacation time. Consider how California law's definition of vacation time as wages plays a role in determining an employer's responsibility to pay.