(a) Upon separation from service without fault on his or her part, an employee is entitled to a lump-sum payment as of the time of separation for any unused or accumulated vacation or for any time off to which the employee is entitled by reason of previous overtime work where compensating time off for overtime work is provided for by the trustees. This sum shall be computed by projecting the accumulated time on a calendar basis so that the lump sum will equal the amount which the employee would have been paid had the employee taken the time off but not separated from the service.

(b) Employees separated from service through fault of their own are entitled to a lump-sum payment for compensating time off for overtime work, and in addition, the portion, if any, of unused vacation as the trustees may determine. The computation of this sum shall be based on actual accumulated time without projection as provided in subdivision (a).

(c) Lump-sum payment for vacation shall not be made to a person who separates from a position for the purpose of accepting another position in the state service, except either of the following:

(1) Upon movement to a position in which vacation credits are neither accrued nor used.

(2) Upon reassignment of an employee, subsequent to January 1, 1965, from a position other than an academic year position, to an academic year position.

However, a lump-sum payment shall not be made to a person who returns to a position in the same class within 15 working days of the date of the person’s resignation.

(d) Except for payment authorized or excluded under subdivision (c), an employee who returns to state service during the period through which his or her lump-sum payment was computed may refund the amount of lump-sum payment which exceeds his or her break in service and have the balance of credits restored as though he or she had remained in state service and taken the time off.

(e) If subdivisions (a) to (d), inclusive, are in conflict with the provisions of a memorandum of understanding reached pursuant to Chapter 12 (commencing with Section 3560) of Division 4 of Title 1 of the Government Code, the memorandum of understanding shall be controlling without further legislative action, except that if the provisions of a memorandum of understanding require the expenditure of funds, the provisions shall not become effective unless approved by the Legislature in the annual Budget Act.

(f) Notwithstanding other provisions of this section, the trustees may provide for lump-sum payment for vacation for nonrepresented employees of the California State University.

(Amended by Stats. 1988, Ch. 227, Sec. 1.)