OIG Advisory Regarding City’s Late Payments of Supplementary Vacation

Executive Summary

The Office of Inspector General (IGO) received complaints in 2012 from two former City
employees from different City departments that the City was significantly late in disbursing
vacation pay owed to them upon separation. These complaints prompted the IGO to review the timeliness of the City’s post-separation vacation payouts. The IGO’s review found that the City is consistently late in paying its employees earned vacation payouts, taking, on average, over 50 days to pay former employees money owed. Such late payments could potentially subject the City to liability, is inconsistent with state policy, and, ultimately, does a disservice to the City’s employees.

The IGO analysis of those employees who separated from City employment in the last four years and who received vacation payouts as of March 16, 2013, found that only 14% received their earned vacation pay within 16 days of leaving the City. During this same period, the citywide average time for disbursement of vacation pay was 53 days after separation. While employees in nearly one-third of City departments were paid within an average of 30 days, employees in a few City departments received final payouts, on average, more than three months after an employee left City service.