TN 8 (11-93)

RS 01401.370 Vacation Pay and Pay in Lieu of Vacation

A. DEFINITIONS

1. Vacation Pay

Vacation pay is the amount the employer pays to an employee during the course of the employment relationship for the period of time the employee is away from work.

2. Pay in Lieu of Vacation

Pay in lieu of vacation is additional compensation to the employee for unused vacation.

B. POLICY

Both vacation pay and pay in lieu of vacation are wages for computation purposes in the period they are actually paid.

NOTE: Vacation payments made from union-administered funds, such as the International Ladies Garment Workers' Union (ILGWU) Health and Welfare Fund, are wages. Although the employer is responsible for reporting the vacation payments for SSA purposes, the employer may authorize an agent (such as the union) to do so, but only with IRS approval.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0301401370
RS 01401.370 - Vacation Pay and Pay in Lieu of Vacation - 12/06/1993
Batch run: 01/27/2009
Rev:12/06/1993