Benefits

Summary

English (Rev. 9/2015)

Text

STATE OF CALIFORNIA Gavin Newsom, Governor 
DEPARTMENT OF INDUSTRIAL RELATIONS 
DIVISION OF LABOR STANDARDS ENFORCEMENT 
BENEFITS 
VACATION: Paid vacations are not required under California law.  If an employer has an oral or written vacation policy, 
such vacation benefits are considered wages and are earned by the employee on a pro rata basis for each day of work.  Be cause vacation is a 
form of deferred wages and vests as it is earned, vacation wages cannot be forfeited.  (Suastez v. Plastic Dress Up (1982) 31 Cal.3d 774)  An 
employer can place a reasonable cap on vacation benefits that prevents an employee from earning vacation over a certain amount of hours. 
(Boothby v. Atlas Mechanical (1992) 6 Cal.App.4th 1595).  When an employment relationship ends all vacation earned but not yet taken by the 
employee must be paid at the time of termination. (Labor Code §227.3). If employees are subject to a collective bargaining agreement, the 
provisions pertaining to vacation benefits in the collective bargaining agreement will apply.  (Labor Code §227.3) 
SICK PAY: Sick pay legal requirements under California law are available at www.dir.ca.gov/dlse/ab1522.html 
If an employer has a sick leave policy, the employer must permit an employee to use in any calendar year, the employee’s accr ued 
and
 available sick leave, in an amount not less than the sick leave that would be accrued during 6 months at the employee’s current rate of 
sick leave, to attend to an illness of a child, parent, domestic partner, or spouse of the employee. (Labor Code §233) 
WORKERS’ COMPENSATION INSURANCE: All employers, except the state, are required to have workers’ 
compe
nsation insurance to cover injuries or illnesses sustained on the job.  (Labor Code §3700, et seq.)  An employee who suffers a work -
related injury or illness that requires medical tr eatment beyond first aid must notify his or her employer in writing within 30 days of the 
injury or illness.  (Labor Code §5400)  Contact the local Division of Workers’ Compensation office for more information regar ding 
workers’ compensation claims and benefits at www.dir.ca.gov/dwc. 
HOLIDAYS: California law does not require that employers provide employees with paid time off for holidays, observe any 
holid
ays, or pay an employee any additional compensation for working on a holiday. Employees should refe r to their employer’s policy 
with respect to paid holidays. 
MEDICAL AND/OR LIFE INSURANCE: There is no requirement under California law for employers to provide 
empl
oyees with medical and/or life insurance.  Employees should refer to their employer’s pol icy with respect to medical and life insurance 
benefits. An employer who provides employee medical benefits and discontinues those benefits must provide employees with wri tten 
notice at least 15 days in advance of the discontinuance of coverage. (Labor C ode §2806) A terminated employee may be entitled to 
continued coverage under the federal COBRA act or California's continued coverage requirements. Contact the Department of Health 
Services at www.dhs.ca.gov.  Any health benefits provided by an employer pursuant to the Employee Retirement Income Security Act of 
1974, 29 U.
S.C. §1001, et seq. (ERISA), are subject to federal law.  Contact the U.S. Department of Labor at www.dol.gov. 
PENSION AND RETIREMENT PLANS: Employee pension and retirement plans are not required under California 
law.
  Employees should refer to their employers’ policy with respect to pension plans.  Any pension plans provided by an empl oyer 
pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. §1001, et seq. (ERISA) , are subject to federal law.  Contact 
the U.S. Department of Labor at www.dol.gov. 
SEVERANCE PAY: There is no legal requirement under California law that employers provide severance pay to an 
empl
oyee upon termination of employment. Employees should re fer to their employer’s policy with respect to severance pay.   Severance 
pay plans provided by an employer pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. §1001 et seq. (ERISA), are 
subject to federal law.  Contact the U.S. Depa rtment of Labor at www.dol.gov.   In certain limited situations, California laws may apply. 
Howev
er, a thorough review of the facts is necessary before a determination can be made. 
DLSE-2005-B-2 
Revised  9/2015

Retrieval chunks

• #1

  STATE OF CALIFORNIA Gavin Newsom, Governor DEPARTMENT OF INDUSTRIAL RELATIONS DIVISION OF LABOR STANDARDS ENFORCEMENT BENEFITS VACATION: Paid vacations are not required under California law. If an employer has an oral or written vacation policy, such vacation benefits are considered wages and are earned by the e…

• #2

  MEDICAL AND/OR LIFE INSURANCE: There is no requirement under California law for employers to provide empl oyees with medical and/or life insurance. Employees should refer to their employer’s pol icy with respect to medical and life insurance benefits. An employer who provides employee medical benefits and disconti…