Employers in the state of Colorado who offer earned vacation to their employees as a benefit are no longer allowed to impose “use it or lose it” policies that forfeit said vacation in the event of the employees separation from the employer.

The Colorado Wage Protection Act, passed by state lawmakers last year, not only forbids the practice of revoking earned vacation on the event of an employee’s termination, but it also provides the state Division of Labor with the authority to adjudicate disputes over earned vacation up to $7,500.

It is important to note that Colorado law does not require that an employer provide earned vacation hours or vacation time – while offering this specific benefit remains up to the discretion of the employer, once the benefit is extended the employer must consider and classify, by law, all vacation pay the same as standard wages or compensation.