Can an Employer Take Away Your Used Vacation Days?

The primary question here is whether an employer can cancel previously used vacation days, especially in the context of travel plans that have already been made. To answer this question effectively, it's essential to understand the legal and policy frameworks surrounding vacation days in most employment jurisdictions, including the specific rights and responsibilities of both employees and employers.

Legal and Policy Aspects

In most jurisdictions, including Canada, vacation days are considered a form of compensation. According to labour laws and employment contracts, an employee's right to take and use their vacation days is protected. This means that once an employee has used their vacation days, the employer is committed to honoring this right, provided the vacation was approved and used in accordance with company policies.

Employer's Responsibilities

Employers have a responsibility to provide clear vacation policies and inform employees of these policies in writing. If an employee has used their vacation days without any explicit agreement to the contrary, the employer cannot unilaterally take back these days. This is particularly important in light of the fact that once a vacation is taken, it can be considered a rights accommodation, nearly equivalent to earned pay.

Why Cannot an Employer Cancel Approved Leave?

Many critical services, such as police, hospitals, and the military, often include a clause in their employment contracts allowing the employer to cancel previously approved leave in certain emergency situations. However, for most employees in regular industries, this is not the case. Employers are not typically permitted to cancel approved leave without the employee's consent.

Exceptions and Specific Circumstances

There may be rare exceptions, such as in cases where the employee has entered into a special agreement with the employer or where the company has a robust emergency response policy. In such instances, an employer should provide clear communication and sometimes financial incentives to help the employee adjust their plans.

Financial Implications

The situation can become more complex when travel plans have been booked and paid for. In this scenario, it would be highly unlikely for an employee to agree to cancel the vacation without a significant financial incentive. Such a scenario would cover not only the cost of the vacation but also any additional expenses associated with travel during peak or off-peak seasons. The total amount often includes not just the employee's cost but also the costs for their entire family.

Company-Specific Policies and Accumulation Limits

In some companies, especially in Canada, there may be limits to the accumulation of vacation days. For example, our previous CEO set a limit of 200 working days. Employees who had accumulated more than 200 days were required either to use the excess days or sell them to the company. Any sale of accumulated vacation days required payment at the company's rate of pay per day. In such cases, the tax implications for both the employee and the company were significant, with a 45% super tax rate on any leave sold to the company.

Conclusion

In conclusion, an employer typically cannot take away vacation days that an employee has already used and enjoyed, particularly when these days have been approved and used as planned. Companies and employees must ensure they have clear policies and agreements in place to avoid any misunderstandings and ensure mutual respect and responsibility.