Do we have to pay out PTO when an employee leaves?
State law determines employers have to cash out vacation time, which likely includes PTO.
We recently switched from a system of offering separate sick time and vacation time to one paid time off (PTO) entitlement. Employees get 12 paid days off per year, to use as they see fit. Employees accrue PTO every pay period; once they reach three weeks, they don't accrue any more unless they use some. We do business in California, and I know we have to pay out unused, accrued vacation time when an employee leaves. But does this include all PTO, even though some of it is supposed to cover sick leave?