Vacation: EOY Payout vs use or lose

We are considering moving to a policy where we pay out part of the vacation time that employees accrue through the year. We are a billable company so we lose money when our employees aren't working, hence our consideration. I am interested in hearing from others about pros and cons to both policies. Thanks in advance!

 

We are in Ohio.

 

We would limit the number of days the person could be paid out and the expected payout would be late in the 1st quarter of the following year for everyone with available time, so constructive receipt wouldn't come into play (if I'm reading this right.) I hadn't thought about paying at a lower rate; not sure if TPTB would like that but a good thing to bring into the conversation.

 

Fair enough. I know CA has different ways to handle vacation time, among other things. I appreciate all of the insight.