An unexpected change to your workplace benefits can affect your finances and plans. If your employer reduces vacation time, changes a benefit plan or stops providing a benefit, you may wonder whether the company can make that change. The answer depends on the type of benefit and whether you already earned it.
Not all benefits have the same protections
California does not require employers to provide every type of benefit. However, once an employer offers certain benefits, other rules may apply. Your employee handbook, employment agreement or benefit plan may also establish specific terms.
For example, California treats earned vacation as wages. An employer generally cannot take away vacation time you already earned. A company can change how employees earn a vacation in the future, but it cannot simply erase what they already accrued.
When employers may face restrictions
The circumstances surrounding a benefit change can determine whether the employer acted lawfully. Pay-related benefits, leave and other employment benefits may have specific protections.
Before changing a benefit, an employer should consider whether you already earned it, whether an agreement controls the benefit and whether another law protects it.
Employees should pay attention to changes involving:
- Earned vacation or paid time off
- Paid sick leave
- Bonuses or commissions
- Health or retirement benefits
- Benefits promised in an employment agreement
- Benefits covered by a collective bargaining agreement
California law also establishes minimum requirements for certain paid sick leave benefits. An employer can offer more generous benefits, but its policy must still meet those minimum requirements.
What employees should review
If your employer announces a benefit change, review the current policy and any documents you received when you started working. Compare those terms with the new policy and determine whether the change affects benefits you already earned or only future benefits.
Keep copies of relevant policies, benefit statements and written notices. These records can help you determine what your employer promised and when the company changed the benefit.
Understanding whether you earned a benefit, received a promise for it or accepted it under a specific plan can help you assess whether your employer can lawfully change it. Reviewing the applicable documents can clarify your rights when an employer reduces or removes a benefit.