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Quick Summary
If paid time off in California, also known as PTO or personal leave, can be taken without any condition, then it is presumed to be vacation time, meaning the employee is entitled to be paid for accrued but unused time when their employment ends. If the PTO can only be taken during a certain time, such as on holidays, then it is not considered vacation time and does not need to be paid.
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More extensive legal analysis
Legal Research - Letters from the Division of Labor Standards Enforcement discussing this issue and its permutations
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