California Employers Allowed to Deduct Vacation and Sick Leave in Hourly Increments

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On November 23, 2009, the California Department of Industrial Relations (DIR) Division of Labor Standards Enforcement (DLSE) issued an opinion letter on the topic of an employer making deductions from an exempt employee’s vacation or sick leave balances. This new opinion letter affirms that employers may make such deductions in hourly increments for partial-day absences by an employee without jeopardizing the employee’s exempt status.

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