When PTO policies change.
Your employer changed the PTO policy. That's within their rights under Texas law. But there are limits, and you have options.
What Texas law says about PTO
Texas does not require employers to provide paid time off. PTO is a voluntary benefit. That means the employer sets the terms. It also means they can change those terms.
However, once PTO is earned under an existing policy, it may be considered earned wages under the Texas Payday Law. An employer who takes away PTO you have already accrued may be violating that law. The key word is "accrued." Future accrual rates can change. Time you've already banked is a different question.
What they can do
- Change the accrual rate going forward.
- Cap the maximum PTO balance.
- Change the payout policy for future separations.
- Implement a "use it or lose it" policy with reasonable notice.
- Restructure the tier system.
What gets complicated
- Already-accrued PTO: If you earned it under the old policy, there's a legal argument that it's yours. The Texas Workforce Commission handles these claims.
- Promised milestones: If your employer documented specific PTO milestones tied to tenure, and you relied on those promises when making employment decisions, that reliance may matter. This is called "promissory estoppel." It's not a slam dunk, but it's a recognized legal concept.
- Selective enforcement: If the new policy applies differently to different employees without a legitimate business reason, that could raise discrimination concerns.
- No payout on separation: The current handbook says accrued but unused PTO "is forfeited and will not be paid" when you leave. If the previous policy paid out accrued PTO upon separation, that change may not apply retroactively to time earned under the old terms. The Texas Workforce Commission considers whether an employer's own prior policy created an obligation.
- Forfeiture applies to everyone, including people who didn't choose to leave: The handbook says accrued but unused PTO is forfeited "regardless of the reason" for separation. That includes employees who are laid off, restructured out, or fired. If the company eliminates your position to make the books leaner for outside investors, your accrued PTO disappears with your job. Worth knowing before it happens.
If the old PTO policy was in writing, save a copy. If milestone promises were in an email, an offer letter, or a previous handbook, keep that documentation. You can't dispute a change if you can't prove what was promised. See how to document things safely.
What you can do
- Talk to coworkers about it. That's protected concerted activity under the NLRA. You can compare notes, share concerns, and raise the issue collectively.
- File a wage claim with the Texas Workforce Commission if you believe accrued PTO was taken without payment.
- Put your concerns in writing to management. A written record protects you more than a hallway conversation.