Vacation Archives

Gross Up – Key Words & Phrases

Published on May 21st, 2019 by Alan L. Sklover

Sklover Working Wisdom Keywords Phrases

What is the meaning of . . .

“Gross Up”?

Everyone is legally permitted to try to avoid taxes – I did not say “evade” taxes – or to pay as little as permissible, in any legal way available to them.

For employees, the most common opportunity to do so is when they incur work-related expenses that may require them to pay taxes on some of the reimbursement.

Examples may include (a) relocation reimbursement, which is now fully taxable to the employee, (b) educational reimbursement that may be partially or fully taxable to the employee, (c) entertainment or travel reimbursement that may be partially or fully taxable to the employee, especially if in excess of certain allowable limits, and (d) automobile expenses.

So, for example, if an employee is asked to move his or her residence for a year or two from Boston to Belgium, moving expenses (for themselves and their family) is considered non-deductible for them, and if the employer reimburses them for that expense, all of the reimbursement is considered income to the employee, who must pay tax on it.

Here’s another example: if your employer asks you to take courses to enhance your work skills, and the cost in one year exceeds $5,200, the excess amount, if reimbursed by your employer, is considered income to you, and you must pay tax on it. There are many other real-life examples, too.

So what’s the solution? Ask your employer to not only reimburse you for the actual expense, but to also pay you the amount you will have to pay in tax on that reimbursement. That is called “Gross Up” for tax purposes, or “Tax Gross Up.”

While it takes a little “gymnastic arithmetic” to figure out exactly how much “Gross Up” payment to you is needed to precisely “Gross Up” tax that you will have to pay, that calculation can be done by your employer, its payroll service, or your own tax advisor.

The reason that it is a bit complicated to calculate “Tax Gross Up” is that the employer should not only (a) pay the additional tax due by the employee, but (b) should also repay the employee for the new tax to be due on the original reimbursement amount, as well.

As an illustration, if the employee incurs a relocation expense of $1,000, and the employer reimburses the employee the $1,000, the employee may have to pay income tax on the $1,000 received of about $300. But wait a minute: then the employee has to pay tax on that $300, as well, which might come to yet more income tax of $90. So, the employer should also “Tax Gross Up” that amount, too. (I told you it was a bit complicated.)

So, whenever a work-related reimbursement is taxable to you as income, or you believe it may be, ask for “Gross Up” for tax purposes, or “Tax Gross Up” as it is also commonly called.

If you do so, there will be more money in your pocket after tax time, and, hey, there’s nothing wrong with that!!

Be aware. Be alert. Look before you leap. That is to say, be “SkloverWorkWise.” You will be VERY GLAD you did.

Incidentally, we offer a Model Memo titled “Request for Tax Gross Up” to send to your employer. Like all of our Model Memos and Letters, it shows you “What to Say . . . and How to Say It.”™ To get yours, [click here.] Delivered in minutes to you by email.

(Please note: This email newsletter does not constitute legal or tax advice; for such advice or counsel, you need to consult a lawyer or tax adviser. In addition, laws change, and that may include the present tax treatments noted above, and, so, reliance upon this email newsletter must take these warnings into account.)

Need a model memo or letter to transmit a request or complaint? A good checklist or form agreement? For a complete list of our Model Letters, Memos, Checklists and Sample Agreements, Just [click here.]

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Your Path to Dignity at Work”™

© 2019 Alan L. Sklover All Rights Reserved and Strictly Enforced.

“Afraid to Take Vacation? Here’s Seven Ideas”

Published on August 26th, 2014 by Alan L Sklover

Question: Hi, Alan. I have been employed with a company for almost 12 years. I have accrued more than 400 hours of paid time off, which included vacation and sick time. If I leave tomorrow, (or they fire me) I can only be paid for 240 hours of the more than 400 I’ve accrued. 

I’m hardly ever sick and my job is so busy I cannot take more than a day or two of vacation at a time. I do make it a habit of taking a solid week in the summer and usually every Christmas holiday. But that hardly makes a dent in my accrued time off. 

My question is this: Are there any protections for employees in this situation? 

I am afraid that if I ask to take a good portion of my accrued PTO, my managers will view me as something less than a loyal employee. However, this is PTO I’ve earned – trust me on this! If I can’t use it without fear of retribution, what’s the point? 

I’d appreciate any insight you might have on this.

Christy
Hanover, New Hampshire 

Answer: Hi, Christy. It is a widely known fact that many employees – especially in the U.S. – are afraid to take off for vacation (and other paid time off, commonly called “PTO”) that they have earned. Coupled with the fear of losing your job for being viewed, as you describe it, as being “less than loyal,” and you have a recipe for loss of earned benefits, if not problems with your health. There are a few things I might suggest that might – or at least I hope will – lighten your burden.

1. First, give serious consideration to whether your fears are based in reality. You know, fears are fears, and they cannot be dismissed out of hand. I do not at all mean to trivialize your fears, or dismiss them. Rather, what I do mean to do is to ask that you examine whether your fears of retribution are based in reality. It is often the case that fears are not, and for this reason sometimes fears needlessly hold us back from enjoying our lives. 

As for a few examples, have you ever heard of a colleague being accused of being “less than loyal” for taking accrued time off? Being denied a raise, bonus, promotion on that basis? Does everyone in your department avoid taking time off like you do, or do some of your colleagues seem to find a way to enjoy their paid time off? Have you ever been treated in any negative way due to your taking the week off in the summer, and the week off around Christmas time? Just curious: have you asked friends at work if they have the same fear? These are just a few of the ways you might perform a “reality check” about your fears of taking time off. 

More than I have ever seen in my 30+ years assisting employees, it seems to me that employees are more fearful about their jobs, more fearful about possible retaliation on the job, and more fearful than ever of losing their jobs. Fears are sometimes based in reality, but sometimes they are not. Your first step ought to be to determine if “real data” exists to believe your fear of retribution is a real one. 

2. I know of no “legal protections” for employees afraid to take off vacation or PTO time, but creative “navigation” of workplace problems almost always works better than “legal protections.” Many states have laws that speak to whether employees must get paid for accrued but unpaid vacation time when they leave their employees, but I have never heard of any law that protects people from “retribution” or “being viewed as disloyal” if they take advantage of paid vacation or PTO time. (Your state of Kansas, in particular, has no such legal protection. For more information about this, go to www.dol.ks.gov.) 

I do believe, as I discuss below, that creative “navigation” is almost always your best route to fairness and success in work-related issues; not always successful, but usually more successful than relying on laws, rules or regulations. 

3. Many people in your situation use the federal FMLA law to use their extra vacation and PTO days. If by chance you or a member of your family becomes ill, injured, requires an operation, begins to need some type of therapy, or even in need of serious rest, and a physician will certify the need for your taking a medical leave of absence to assist in the healing process, by invoking the Family Medical Leave Act (usually called “FMLA”) you can take what is usually unpaid time off – but make it paid time off –by using unused vacation and PTO time. 

Such legally-protected leaves of absence can be up to 12 weeks each year, and can be one week per month (or even shorter intermittent intervals) if physician-certified as necessary and appropriate to full recovery. Such leaves are very much more palatable to others, and BY LAW cannot be retaliated against without very tough legal penalties. 

One of the ways the United States Congress made the FMLA law quite strong is by incorporating a provision that provides that any person who interferes with the exercise of FMLA rights can be individually sued, even if they acted in their corporate capacity. Such personal accountability goes a long way to prevent retaliation.

Act Wisely! Consider using our Model Memo Requesting FMLA Information, Forms and Procedures from Human Resources. It shows you “What to Say and How to Say It”™ and makes a permanent record of your request. Just [click here.] Delivered Instantly By Email to Your Printer.  

4. Consider raising your concern – in writing – directly with your Manager and/or Human Resources representative. Though it surely might sound “confrontational” to “confront” the issue with those in charge, and especially to those with authority “over” you, doing so in a non-confrontational, respectful, matter-of-fact, way – but always first in writing –might help you in at least three different ways: 

(i) First, your Manager and/or Human Resources representative might have dealt with such concerns previously, and therefore might offer a solution that you have not thought of, such as taking a paid leave of absence to gain needed education or training, as time off for those reasons tend to be more “palatable” to others;

(ii) Second, your Manager and/or Human Resources representative might agree to an unofficial “bending” of the official time-off rules, such as a half-day each Friday in the summer, especially if either they seem to get something they want as part of the “bending,” or if they view doing so to be in their interests; and

(iii) Third, your Manager and Human Resources representative have access to higher authority in the organization, and so might be able to secure a formal exception to the rules for you, such as authorizing a “buy back” of your unused time off.  

I fully appreciate that these may be the very same people you think might think less of you for taking your paid vacation and PTO time off, I really do. It’s just that people can sometimes be more “angelic” and less “devilish” than we sometimes imagine. In most cases, I believe there will be little, if any, downside risk in doing so. 

You might want to watch our Video, “Job Security – Lower Your Odds of BeingLaid Off.” Just sit back, relax, watch and listen. One of our Sklover Videos On Demand. To see our Complete List. Just [click here]. 

5. Emailing your concerns about possible retaliation is unquestionably the number one way to prevent retaliation from taking place. Imagine the following: A boss is bullying an employee. The employee writes an email to the boss, with a copy to the bully’s boss and Human Resources, and says “You are bullying me. I am filing a complaint. Do not retaliate against me, because that would be a violation of our company’s policies.” 

Do you think the boss will retaliate? Chances are that the bully would be less likely than ever to do so, as it would surely be noticed and punished. Though it may seem counter-intuitive, it does really work.  

You may be saying to yourself, “Retribution works in a far more subtle fashion – and often in ways that cannot be proven.” I would agree, but that does not mean you can’t keep careful vigil, and keep your guard up – and your email ready – at the very first sign of retaliation.  

6. Also, might you think of ways to both (a) take time off, but at the same time (b) demonstrate that you are an extremely “loyal” employee. As is often said, “Perception is more important than reality.” Using your considerable creativity, can you find ways to get others to cover some of your responsibilities yet make certain – perhaps by planning ahead, maintaining contact through email and texting, or even attending certain meetings over the internet –that you are seen as both “present” and “performing,” even if you are really fishing on the lake? The use of digital communications is making such “virtual presence” easier and easier every day.  

In fact, though I often do my work outside of my office, because of the frequency of my communications my staff sometimes swear that either I am hiding somewhere in the supply room or I have a camera overhead. You could do the same.  

When leaving employment – for any reason – ALWAYS ask to be paid for Accrued But Unused Vacation. Use our “Model Letter Requesting Payment for Accrued but Unused Vacation – with 12 Great Reasons.” It shows you “What to  Say and How to Say It.”™ To get your copy, just [click here.] Delivered by Email – Instantly!

7. None of these suggestions can be considered guaranteed, but each might be the one thing that gets you what you want, need and deserve. There are innumerable ways to address fearful situations at work. You are only limited by your imagination and your faith in yourself. The truth is this: if you are viewed as a valuable employee – through showing up on time, hard work, a positive attitude, respect for others, and a loyalty to the organization – then your managers will not consider retaliating against you for taking the time you have earned.  

Christy, I hope one or more of these suggestions helps you. Your contributing to our blog has helped me share my own thoughts, with the hope it helps others. That reminds me of the saying “God gave us two hands – one to give and one to receive.”

My Best,
Al Sklover 

P.S.: Want to learn more about workplace negotiating? Consider viewing our Sklover On Demand Video entitled “Can I Really Negotiate with My Boss?” Just sit back, relax, watch and listen. To do so, just [click here.]  

  Repairing the World,
One Empowered – and Productive – Employee at a Time™

© 2014, Alan L. Sklover All Rights Reserved. Commercial Use Prohibited.

“Vacation and Vacation Pay – 50 Frequently Asked Questions”

Published on March 12th, 2014 by Alan L Sklover

“A vacation is what you take when you can no longer take
what you’ve been taking.”

 –       Earl Wilson     

ACTUAL “CASE HISTORIES”: According to the Bible, even God took a day off after creation. And, so, too, every now and then you need a time to rest, relax and recuperate from what you do all day, all week, and all month long. And that is to be expected. 

We receive many questions from our blog visitors about vacation rights and vacation pay. So, in hopes that you are planning a time to recharge your own batteries, and to help you get all of the respite you truly need, we have put together these 50 FAQs about vacation time and vacation pay, and the answers to each. 

LESSON TO LEARN: As it is with every other aspect of the employment relation, it pays to know “the rules” of your workplace related to vacation rights and vacation pay, so that you don’t  unknowingly violate them, but instead follow them, and make sure others follow them, as well, to your best advantage. 

Because so many employers are trying to cut back on pay and benefits wherever and whenever they can, it is more important than ever to know your rights and to be prepared to stand up for  those rights in a smart and effective way.  

HERE ARE OUR 50 “FAQs” ABOUT VACATION AND VACATION PAY: Remember: These are generalized answers, intended to provide generalized understanding, only. Your state law might provide differently.  Read the rest of this blog post »

“If I am required to give ‘four weeks’ notice when I resign, can one of those weeks be a vacation?”

Published on September 16th, 2010 by Alan L Sklover

Question: I have a vacation planned for later this month. However, I just received a job offer and I plan to accept it.

My company handbook states that, to receive earned but unused vacation, a departing employee must give at least four weeks notice before leaving. I can give four weeks, but week #3 of those four weeks would be the week of my planned vacation.

Will this legally count as part of my four weeks, or will this give them an “out?”

         Aaron
         Allen, Texas

Answer: Aaron, the answer to your question starts with Texas law: it does not require an employer pay accrued but unused vacation when an employee departs, but does require that, if the company has a policy on this subject, it must follow that policy uniformly. Incidentally, that is quite common; the law in many states says the same thing.

So, your question is not one that can be answered by “the law,” but rather by the details of your employer’s employee handbook and/or company policy book. 

If there is a clear policy that would permit you to do what you want to do, your employer must follow that clear policy. If there is no policy on that issue, then your employer may have an “out.”

In my experience, what you contemplate – that you will take a vacation during one of the four “required weeks” of notice – would be entirely acceptable at most companies.

My suggestion: Visit Human Resources, ask about the details of their policy so you can use that information to wisely plan your life. Do not be afraid to be open and honest about what you would like to do. Even if the policy does not say what you’re hoping it says, perhaps you can find a way to negotiate to get what you want. Better you have clear answers now, than a dispute later on.

When leaving employment – for any reason – ALWAYS ask to be paid for Accrued But Unused Vacation. Use our “Model Letter Requesting Payment for Accrued but Unused Vacation – with 12 Great Reasons.” It shows you “What to  Say and How to Say It.”™ To get your copy, just [click here.] Delivered by Email – Instantly!

Hope your employment transition is a smooth one. Thanks for writing in. 

           Best, Al Sklover

© 2010 Alan L. Sklover, All Rights Reserved.

Vacation Pay Accrued – Is It Paid to Me If I Resign?

Published on May 5th, 2008 by Alan L Sklover

Question: Are you entitled to collect accumulated vacation pay when you resign (assuming you provide proper notice)? I have several hundred hours saved, and was just curious.

Larry, Minneapolis, MN

Answer: State law governs “vacation pay” issues. Vacation pay is a benefit that employers don’t have to provide, although most employers do. When an employer does provide vacation pay, it is considered a kind of “wage” by most every state. The law in some states, like California, provides that vacation pay is earned on a day-by-day basis, and thus in all events – including resignation – must be paid to the employee. Unfortunately for Minnesota’s citizens, in November, 2007, the Minnesota Supreme Court held that in Minnesota a company’s policy on this issue governs its employees’ rights. The Court’s reasoning was this: company policy is a kind of “contract,” and whatever the employee and employer “agreed” to in that “contract” should govern. Thus, you have to look at your company’s Employee Handbook, Policy Manual or internal web site to find out your rights to earned vacation pay if you resign.

P.S.: When leaving employment – for any reason – ALWAYS ask to be paid for Accrued But Unused Vacation. Use our “Model Letter Requesting Payment for Accrued but Unused Vacation – with 12 Great Reasons.” It shows you “What to  Say and How to Say It.”™ To get your copy, just [click here.] Delivered by Email – Instantly!

Best, Al Sklover


Alan L. Sklover

Alan L. Sklover

Employment Attorney
and Career Strategist
for over 35 years

Job Security and Career Success now depend on knowing how to navigate and negotiate to gain the most for your skills, time and efforts. Learn the trade secrets and 'uncommon common sense' of Attorney Alan L. Sklover, the leading authority on "Negotiating for Yourself at Work™".

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