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Northern District of Illinois Permits Temporary Employees to Proceed With Lawsuit Over Forfeited Vacation Time in Rosales v. The Placers

In an uncertain economy, more people are finding work as temporary employees. While temporary employment can lead to more stable work, it also puts the employee in an awkward situation. Though the employee might do the same work as full-time employees at a company, he or she does not receive the same pay, vacation time, or bonuses. Instead, the employee works for the temporary agency, which is expected to provide wages and benefits. How and when the agency provides them is often a point of contention that requires a Chicago wage and hour attorney to intervene.

In Rosales v. The Placers, LTD, the plaintiffs brought a class-action lawsuit in federal district court against the defendant for violating the Illinois Wage Payment and Collection Act (IWPCA). Plaintiffs Fernando Rosales, Servando Ayvar, and Juan Herrera worked for The Placers, a temporary staffing agency, in 2006. They alleged that The Placers vacation policy forced them to give up earned vacation time in violation of Illinois law.

The policy stated that temporary employees could earn 40 hours of paid vacation if they met certain eligibility requirements. These requirements were that the employees accrue 1,500 hours of work within a 52-week calendar period, or “within the anniversary year of employment.” The plaintiffs claimed that the policy punished any employee who did not accrue 1,500 hours (roughly eight to nine months) within a 52-week period. The defendant sought to have the case dismissed.

The Illinois Wage Payment and Collection Act states: “Every employer shall pay the final compensation of separated employees in full, at the time of separation if possible, but in no case later than the next regularly scheduled payday for such employee.” Meanwhile, IDOL regulations state that “[a]n employment contract or an employer’s policy may require an employee to take vacation by a certain date or lose the vacation, provided that the employee is given a reasonable opportunity to take the vacation.” IDOL also mentions that vacation policies are permitted where “vacation is earned and accrues at an accelerating rate during the year.” An accrued-vacation policy is acceptable when “changes in accrual rates are reasonable” and the policy is applied to all employees.

The defendant argued that because the policy requires employees to earn 1,500 hours to qualify for vacation time, they cannot forfeit something they haven’t earned. The plaintiffs responded that IDOL regulation states that when vacation is based on length of service, the employee earns it as he or she provides the service. If employees are continuously earning vacation time until they meet 1,500 hours, then any employee who works less than 1,500 hours, and is then dismissed, would be forced to give up accrued time.

Judge Blanche Manning of the Northern District of Illinois sided with the plaintiffs. She found that past Illinois courts agreed with their interpretation of vacation time accrual. She therefore denied the defendant’s motion to dismiss.

The attorneys at Chicago Overtime Law Center have decades of experience litigating wage and hour cases, including overtime, vacation pay, meal breaks, and tips. The Chicago Overtime Law Center has offices conveniently located in Oakbrook Terrace and Chicago, Illinois. If you live in Illinois and have a wage and hour dispute, contact a Skokie overtime attorney today at 312-869-4095.