For us residents in California, we’re used to seeing budget cuts applied to a lot of things. The financial crisis in California is particularly apparent when you see its effects on the public school system. Well, this article from my local paper just made me wince, because as you can see, the story describes just another example of how our government (this time, at the state level) has been handling its finances.
Well, here’s the latest expose and more fodder on the California budget crisis — apparently, government employees have made off with pretty huge paychecks here in California, simply by NOT taking vacation time. Their unused vacation time translates into big six figure payouts, with the top 25 checks reportedly ranging from $203,921 all the way to a dazzling $815,736. Wow. Imagine this — those state government positions can be a gold mine, with overtime paying off for a whole lot of people. Here is an image that portrays this predicament (Click this link or the image below for a larger picture.):
And here’s a breakdown of vacation pay amounts across California agencies:
Small wonder California is broke.
Want to Attend A Suze Orman Event?
On another note, I’d like to inform you about a personal finance event that’s coming to Club Nokia in downtown L.A. this Sunday, March 14. Suze Orman is slated to speak at this club at an event called “Waves of Inspiration: Women and Money”. The seminar will feature Suze and other ladies and personalities who will talk about personal finance, self-growth and empowerment. For the curious, TD Ameritrade is the sponsor for this event. If you end up attending, you’ll also receive a free annual all-access pass to Suze Orman’s “Save Yourself Retirement Program” (reg cost: $40). There’s also a planned Q & A at the end of the seminar.
You can purchase tickets from Ticketmaster.com, or if you’re interested in picking up a complimentary ticket, let me know (contact me here) — I may have a couple to give away (while it lasts). Here are the event details:
WHAT: Waves of Inspiration: Women and Money with Suze Orman
WHEN: March 14th, 2010 at 2PM
WHERE: Club Nokia, 800 West Olympic Blvd., Los Angeles, CA 90015
Have fun!
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Copyright © 2010 The Digerati Life. All Rights Reserved.
{ 16 comments… read them below or add one }
In theory, though, the state got a lot of productivity out of these people, since they weren’t taking any vacation, right?
Wow – 854 vacation days? It would take me a few years to rack up that many days.
Wow – very cool pickup. That is a crazy amount of vacation days for the top 25.
As a student myself, it’s really disheartening to see the government spending their money irresponsibly. They’ve cut so many classes in addition to general education budget cuts and they’re continuing to cut some more the following year. Because their reckless spending habits have been exposed (well, at least some of them), citizens are beginning to become more aware of their government which is why so many students are participating in protests to stop the budget cuts for schools.
The top guy on the list K. Nguyen is a doctor. 854 days of work from a doctor is 3.5 years. Paying a doctor ~$800k for about 3.5 years labor is pretty standard pay for a doctor.
The problem here is that for some reason they allowed some employees to exceed the cap on maximum # of days they can bank.
So the guy is a doctor, but that pay is for unused vacation time. I don’t have an issue with paying for quality work and service, but paying for time off that was never used? I’ve worked in many companies in the Valley and each one had a “use it or lose it” policy with vacation days.
The big mistake here is that there’s no cap on vacation days, I agree — yet one more thing that the government lets slip, while everyone else (who works for the private sector) gets to absorb and face the consequences of these oversights.
I’ve worked for several high tech companies (including two in Silicon Valley) and it’s pretty standard practice that vacation days (but not sick days) have a cash equivalent. The exact policy varies from company to company:
- One company only paid out when an employee left the company (up to 6 weeks)
- Another company allowed employees to cash out vacation days only during certain periods and required 1 day of vacation to be used for each day that was cashed out
- And the best one yet: One company allowed employees to cash out vacation at any time with no restrictions, and even let employees accrue up to 150 vacation days.
Also, since you cash out vacation days at your current salary, one trick I always use is to save up vacation days when I first start at a company and then cash them out later after I’ve gotten a couple raises.
Back 10 years ago my company would allow vacation carry over, but never would pay you for vacation. Now we are use it or lose it, much like others have mentioned. I think it is irresponsible for a state government to be otherwise. As people get seniority, more vacation and higher pay is the general rule, so the expense would just continue to rise with time….
I see nothing wrong with paying out unused vacation days as long as there’s some reasonable cap on the amount you can bank. If someone has 2 weeks vacation time and they work those 2 weeks instead of taking the time off then that’s 2 weeks extra work the employer got from that person.
The state of CA actually does have a cap on the amount of vacation days that you can accumulate. They limit it at 80 days. For some reason the people listed were allowed to accumulate more than the 80 day cap. Seems that allowing individuals to ignore the rules is the problem in this situation.
But I don’t think anyone has gotten “scammed” out of anything here. That doctor who cashed out >800 days worked those 800 days when he could have instead taken 800 days of vacation. So the state got 800 days of labor out of the guy. Its not like anyone is stealing anything here.
This is so excessive. There’s obviously a huge incentive to not take vacation time and then cash out, the amounts listed would be a nice bump to anyones net worth!
Also, vacation time is given for a reason to get time to unwind and relax away from work. If someone is saving 3.5 years of vacation time I would guess they are stressed from no break and more likely to burn out, be irritable, etc.
Where I work they prefer to pay you out for vacation pay because it screws up the annual budget. When a full time employee is away they are either replaced with a part-timer or a temp. They need to be aware of how much money they should allocate to each category.
They can’t judge if someone needs the vacation time or the money. We all have unique situations.
Thanks for the mention SVB!
They’ve cut so many classes in addition to general education budget cuts and they’re continuing to cut some more the following year. Because their reckless spending habits have been exposed.
Keep digging , there’s plenty more gold to be found. You’ve barely scratched the surface on the CA budget woes and the waste of taxpayer money.
If you look a little closer in the article, it is not just vacation that is being paid out, but other benefit time like Sick leave and comp time. There is more to the story here.
My company recently settled a lawsuit regarding unpaid vacation. For quite a few years, they said that employees were capped at a certain amount based on tenure, and after that, it simply disappeared. A California appeals court found this in violation of federal guidelines, and a lot of employees received large checks for unused vacation!
California has its deficits for one reason, illegals. Look at what it costs to just educate and incarcerate.
The more than $10.1 billion in costs incurred by California taxpayers is composed of outlays in the following areas:
Education. Based on estimates of the illegal immigrant population in California and documented costs of K-12 schooling, Californians spend approximately $7.7 billion annually on education for illegal immigrant children and for their U.S.-born siblings. Nearly 15 percent of the K-12 public school students in California are children of illegal aliens.
Health care. Uncompensated medical outlays for health care provided to the state’s illegal alien population amount to about $1.4 billion a year.
Incarceration. The cost of incarcerating illegal aliens in California’s prisons and jails amounts to about $1.4 billion a year (not including related law enforcement and judicial expenditures or the monetary costs of the crimes that led to their incarceration).
Look at the banks that went under in Cali. from dealing with illegals.
Another way to look at it is the employer got all of those work hours without paying any additional health, retirement or other fringe benefits if the work had been done by an added employee. Organizations with employees who have accrued a lot of vacation time are usually ones that don’t have enough staff to get the job done.