Cap On Vacation Payout Does Not Violate State Law

Ouachita Parish, Louisiana has a policy that terminating employees are able to cash out up to 320 hours of accrued vacation time. Vacation hours in excess of the cap are forfeited.

Julius B. Ellerbe and Nolan B. Harrell retired from the Parish’s fire department with 31 and 29 1/2 years of service, respectively. At the time, the men had been on extended sick leave. During their extended sick leave, they accrued annual leave of 720 and 696 hours respectively. When the Parish paid them each for only 320 hours of annual leave on their retirement, they sued.

The firefighters pointed to a state law that provides that the vacation privileges of firefighters “shall not be forfeited by any member of the department for any cause.” The Louisiana Court of Appeals turned away the lawsuit, and found that the Parish’s policy did not violate the law.

Citing an earlier decision of the Louisiana Supreme Court, the Court found that “a ceiling on the number of vacation days a fireman may carry forward is not, in itself, a forfeiture of earned vacation days, unless the fireman was denied the opportunity to use those earned vacation days. The Parish’s system explicitly allows firefighters to carry over annual leave from year to year. The 320-hour (40-day) cap is reasonable because it relieves the fire department from having to pay, at today’s higher rate, hours accrued perhaps 15 years earlier.

“A cap on carryover years is not a forfeiture unless the fireman was denied the opportunity to use those earned vacation days. Here, both claimants testified that they accrued all the annual leave they are now claiming while they were on sick leave for work-related injuries. There is no showing that they would be able to ‘use’ vacation time while on extended sick leave.

“Moreover, we find that the Parish’s treatment of accumulated annual leave is the result of negotiation between the firefighters, their union and the police jury. Where the system has the approval of the union and its members, the plaintiffs cannot now claim that a system they agreed to is inequitable.”

Ellerbe v. Ouachita Parish Police Jury, 2012 WL 1192206 (La. App. 2 Cir. 2012).