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Texas Payroll/Personnel Resource

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Lump-Sum Payment of Accrued Vacation Time
Making and Computing the Lump-Sum Payment

Responsibility for Making the Lump-Sum Payment

The state agency that employed a state employee immediately before the employee separated from state employment is responsible for making the lump-sum payment of vacation time to the employee.

This responsibility exists even if the employee, immediately before separation, was employed by the agency in a position that did not accrue vacation time.

Computation of the Lump-Sum Payment

If a state employee’s accrued vacation time is allocated over only one month, the amount of a lump-sum payment for that time is equal to the product of:

  • The number of hours of the accrued vacation time.
    – and –
  • The applicable hourly rate of employee compensation.

If a state employee’s accrued vacation time is allocated over more than one month, the amount of a lump-sum payment for that time is equal to the sum of the amounts attributed to each month included in the allocation.

Allocation of Lump-Sum Payment

The balance of a state employee’s accrued vacation time must be allocated over the workdays following the effective date and time of the employee’s separation from state employment until the accrued vacation time is completely allocated.

State or National Holidays

Eight hours must be added to the employee's accrued vacation time for each state or national holiday that occurs during the period when the time is allocated. For part-time employees, the appropriate portion of eight hours must be added.

The exception to this requirement is that if an employee is separated because of moving from a position in a state agency that accrues vacation time to a position in that agency that does not accrue vacation or by moving from a position in a state agency that accrues vacation time to a position in another state agency that does not accrue, if the other state agency refuses to credit the employee for the balance, then the agency making the payment may not include any state or national holidays in the calculation of lump-sum payment of unused vacation time.

Part-Time Employees

Part-time employees are paid a lump sum as a percentage of 40 hours the employee is scheduled to work each week on the date of separation.

Source

Texas Government Code, Sections 661.061-661.067, 661.091-661.094.