Indefinite Furloughs Trigger Vacation Payout Requirements

October 12, 2023 | From HRCalifornia Extra

by Matthew J. Roberts, J.D.; Associate General Counsel, Labor and Employment, CalChamber

At the COVID-19 pandemic’s onset in March 2020, many of the first questions employers asked involved the legal significance of “furloughing,” or temporarily laying off employees. One concern was whether a furlough is considered a termination triggering the potential for final pay under California Labor Code section 203.

On September 23, 2023, the Ninth Circuit Court of Appeals, persuaded by a California Division of Labor Standards Enforcement (DLSE) opinion letter, issued a ruling that expands upon final pay rules beyond just the unique circumstances of the COVID-19 pandemic (Hartstein v. Hyatt Corp., No. 22-52276 (9th Cir. Sept. 23, 2023)).

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