February 10, 2012

More on the liquidation of leave credits upon separation from service


More on the liquidation of leave credits upon separation from service

As a follow-up to a NYPPL posting replying to an inquiry concerning the liquidation of leave accruals upon separation,* a reader asks: Is an employee terminated for cause entitled to payment of accrued vacation leave credits?

Among the decisions in NYPPL’s files addressing this issue is Rubinstein v Simpson, 109 AD2d 885.

In Rubinstein the Appellate Division said no, explaining that in the absence of a statutory or contractual right to such payment, the employer does not owe the dismissed individual  any payment for his or her unused vacation leave accruals upon his or her termination for cause.

The State's Attendance Rules for the Classified Service (4 NYCRR 30.1), which apply to employees of the State as the employer, provides that "No 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, shall be entitled to vacation credits...."

A number of municipal civil service commissions have adopted a similar rule. According to Rubinstein, such a rule is not necessary. Unless there is some statutory or contractual right to such payment, the employer may lawfully refuse to liquidate the dismissed employee's leave accruals.

However, under certain circumstances such payment to an individual terminated from service is required. For example, when an employee was earlier refused permission to use leave credits “because of the demands of work” and was later terminated, the Appellate Division ruled that the employee was entitled to payment for his unused leave accruals. (See Clift v City of Syracuse, 45 AD2d 596.)