[acomjean]

Most companies only let you bank so many pto (Paid Time Off) hours and carry them over year to year. I think this came about because of accounting change where employee hours are considered a liability (Hours/Money owed for nothing in return), but I might be wrong on that.

As a result employees can't just bank their vacation hours and get a big payday when they leave. It tends to only take a couple years to get up to the max, and you end up with "use it or loose it" pto.

[ghaff]

It's been accounting rules for a very long time. It's pretty much Accounting 101. If you accrue liabilities that you're obligated to provide (either in the form of employee time off or pay-out upon departure), that's a textbook liability.

Which is why employers almost always cap in some form or another; the exact mechanism is partially determined by state law.

I worked for a company once that, during a bad spell, eliminated an accrual cap to encourage people to bank vacation. The result was that a not small number of people who weren't really into taking vacation just let their balances balloon. The company eventually forced people to work down their balances.

[NullPrefix]

>Hours/Money owed for nothing in return

From the business perspectice services rendered previously is "nothing", because you can't get any more value from that