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Payment for unused vacation credit upon separation from employment

By Harvey Randall, Esq.

Baksh v Town/Village of Harrison, 38 A.D.3d 808

Mohamed R. Baksh sued the Town and Village of Harrison [Harrison] to recover damages for an alleged ?breach of contract? after the Town rejected his demand for payment of the monetary value of his accrued ?compensatory time? following his termination.

Supreme Court granted the Harrison?s motion for summary judgment dismissing Baksh?s complaint and the Appellate Division affirmed the lower court?s decision.

Finding that there was no ?contract? between Harrison and Baksh, and implying that Harrison had not adopted any local law or rule providing for such payment, the Appellate Division held that in the absence of a pre-existing contractual provision or legislative enactment, a municipal employee is not entitled to recover the monetary value of accrued credits such as ?compensatory time,? citing General Municipal Law §92[1].[1]

The court also referred to the decisions in Matter of Karp v North Country Community College, 258 AD2d 775; Matter of Rubenstein v Simpson, 109 AD2d 885; and Dow v Board of Trustees of Farmingdale Public Library, 75 AD2d 632 in support of its ruling.

There are a number of variations on the right to payment for unused vacation accruals. In May v Ballston Spa Central School District, 170 AD2d 920, the court was asked to determine the right of an employee to the cash value of his or her accrued, but unused, vacation time in a situation where the employer denied the employee the opportunity to use such credits during his or her period of employment and the employee is then terminated.

In finding in favor of May, the Appellate Division considered two cases: Hess v Board of Education, 41 AD2d 151 and Clift v City of Syracuse, 45 AD2d 596.

The Hess decision indicates that where cash payment for unused vacation credits has not been expressly authorized by §92 of the General Municipal Law, a public employer is barred by Article VIII, §1 of the State Constitution from making such payments.

However, the Appellate Division said that the Clift ruling can be distinguished from the Hess case on the facts. In Hess, the demand for the payment for unused vacation credits was made by an individual following his resignation. In Clift the employee, when asked to forego taking his vacation, was assured by his supervisors that he would be paid any unused vacation credits upon separation.

Similarly in May the Third Department ruled in favor of the employee upon its finding that the employee ?was induced to forego vacation? when his superiors assured him that he would be paid for his unused leave notwithstanding his involuntary separation as a result of a layoff.

With respect to State employees, the State Civil Service Commission?s Attendance Rules for the Classified Service, 4 NYCRR 30.1 set out a number of limitations that could be imposed with respect to claims for payment of unused vacation and similar accruals. 4 NYCRR 30.1 provides that an employee who is removed from State service as a result of disciplinary action, or who resigns after charges of incompetence or misconduct have been served, is not entitled to compensation for his or her unused vacation credits.

As to the resignation of an employee who have not been served, or who was not about to be served with, disciplinary charges, 4 NYCRR 30.1 provides that the appointing authority may require, as a condition for such payment, that it be given at least two weeks notice prior to the employee?s last day of work.

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[1] § 92. Vacations, sick leaves and leaves of absence of officers and employees. 1. The governing board of each county, city, town, village, school district, and of each fire district or other district corporation and of each civil or political division of the state by local law, ordinance or resolution, or in the city of New York the mayor by order may grant vacations, sick leaves and leaves of absence to its officers or employees with or without pay and adopt rules and regulations in relation thereto. Notwithstanding any other provision of law, any such governing board or mayor may also in like manner provide for cash payment of the monetary value of accumulated and unused vacation time or time allowances granted in lieu of overtime compensation standing to the credit of its officers and employees at the time of their separation from the service, or in case of death in service, to be paid to their beneficiaries.

Full post as published by New York Public Personnel Law on January 17, 2008 (boomark / email).