Bank of America Agrees to $4.28M Settlement Over Unpaid Vacation Time

Bank of America has agreed to pay $4.28 million to settle claims that it didn't pay out unused vacation to departing employees.

The deal covers workers in three states.

Who's covered?

You may be a class member if you meet all of these conditions:

• You worked for Bank of America in California, Illinois and/or New York.
• You had a positive vacation balance when you left the company.
• You didn't receive a payout for that accrued, unused vacation.

What the lawsuit says

The lawsuit claims the bank broke state wage laws by not cashing out vacation time when employees left.

Bank of America hasn't admitted wrongdoing.

What the law says in each state

• California: Employers that provide vacation must pay out accrued, unused vacation at termination, and earned vacation can't be forfeited.
• Illinois: The Wage Payment and Collection Act requires earned vacation to be paid as part of final compensation at the final rate of pay, and no policy can provide for forfeiture.
• New York: The rule is different here.

The law doesn't require employers to offer vacation, and a payout depends on the employer's own policy or agreement.

Forfeiture policies are allowed only if employees received prior written notice of them.

How much could you get?

Payments will vary.

Each person's share depends on how much vacation they accrued, so people with larger balances get a larger slice of the net settlement fund.

Do you need to file a claim?

No claim form is required.

Class members who don't opt out will automatically receive their benefits.

How taxes will work

Settlement payments will be split in half for tax purposes:

• 50% will have taxes and withholdings deducted and be reported on a W-2.
• 50% will be reported on an IRS Form 1099.

A tax professional can explain how this affects you.

Key dates

• Nov. 27, 2026: deadline to exclude yourself or object
• Dec. 17, 2026: final approval hearing

Case details

• Case: Nguyen, et al. v. Bank of America N.A., No. 5:23-cv-04999-PCP
• Court: U.S. District Court for the Northern District of California
• Settlement website: UnusedVacationSettlement.com
• Administrator phone: 866-983-3173
• Class counsel: Stueve Siegel Hanson LLP
• Defense counsel: O'Melveny & Myers LLP

This article is for general information and isn't legal advice.