Colorado Issues New Guidance on Prohibition Against Forfeiture of Earned Vacation or PTO

A series of recent developments in Colorado law have made it clear that employers are prohibited from causing employees to forfeit earned vacation time. A compilation of recent developments and the Colorado Department of Labor and Employment’s current position are contained in Interpretive Notice & Formal Opinion (INFO) #14, which explains that:

  1. Employees must be paid all earned vacation pay when their job ends.
  2. No employment policy or agreement can waive or forfeit earned vacation at any time.
  3. All paid leave which can be used at the discretion of the employee is considered “vacation pay” subject to the non-forfeiture rules.

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Minnesota Supreme Court Rules That Handbook Policies Can Be Contractual Notwithstanding Disclaimer

On February 3, 2021, the Minnesota Supreme Court decided Hall v. City of Plainview, holding that a general contract disclaimer in an employee handbook did not, as a matter of law, nullify a breach of contract claim with respect to a paid time off (PTO) policy within the handbook. As the Hall Court explained, the PTO policy at issue was sufficiently detailed to create a unilateral employment contract such that the employer would be obligated to follow its terms. The decision reminds employers of the importance of careful planning and drafting when it comes to their PTO policies. In light of the Court’s holding, employers should also review their handbooks for other policies and procedures that could be construed as contracts.

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Complying With WARN Act Requirements During the Coronavirus Pandemic

In response to the COVID-19 (coronavirus) pandemic, major retail chains, manufacturers, hospitality providers and other employers have been reducing hours/pay or closing employment sites. For many employers, these layoffs are expected to be temporary while the virus runs its course, but economic challenges could turn short-term layoffs into events that trigger notice obligations under the federal Worker Adjustment and Retraining Notification (WARN) Act or state “mini-WARN” Acts. This article answers employers’ common wage and hour and WARN Act questions caused by the coronavirus.

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