(1) State employees shall, during each year of continuous employment, be entitled to ninety-six working hours of vacation leave with full pay.
(2) State employees who complete five years of continuous employment by the state shall be entitled to one hundred twenty hours of vacation leave during their sixth year of employment and shall thereafter be entitled to eight additional hours of vacation leave with full pay for each additional year of continuous state employment up to a maximum of two hundred hours of vacation leave a year. Vacation leave shall be earned in accordance with the following schedule:
During 1st year of continuous employment ......... 96 hours per year
During 2nd year of continuous employment ......... 96 hours per year
During 3rd year of continuous employment ......... 96 hours per year
During 4th year of continuous employment ......... 96 hours per year
During 5th year of continuous employment ......... 96 hours per year
During 6th year of continuous employment ......... 120 hours per year
During 7th year of continuous employment ......... 128 hours per year
During 8th year of continuous employment ......... 136 hours per year
During 9th year of continuous employment ......... 144 hours per year
During 10th year of continuous employment ........ 152 hours per year
During 11th year of continuous employment ........ 160 hours per year
During 12th year of continuous employment ........ 168 hours per year
During 13th year of continuous employment ........ 176 hours per year
During 14th year of continuous employment ........ 184 hours per year
During 15th year of continuous employment ........ 192 hours per year
During 16th year of continuous employment ........ 200 hours per year
After 16th year of continuous employment ......... 200 hours per year
(3) State employees who are regularly employed less than forty hours a week shall be entitled to vacation leave proportionate to their regular workweek. Any state employee who has been employed by the Legislature or Legislative Council shall, for vacation leave entitlement purposes, be credited with one continuous year of employment for each two hundred sixty working days such state employee was employed by the Legislature or Legislative Council.
(4) As used in this section, state employee shall mean any person or officer employed by the state including the head of any department or agency, except when such a head is a board or commission, and who works a full-time or part-time schedule on an ongoing basis.
(5) For purposes of this section, a state employee who has terminated employment with the state for any reason other than disciplinary and who returns to state employment within one year from the date of termination shall have his or her service for vacation leave entitlement computed by combining prior continuous service with current continuous service disregarding the period of absence, except that a state employee who has retired or voluntarily terminated in lieu of retirement shall, if he or she returns to state employment, be considered a new state employee for the purpose of vacation leave entitlement.
(6) The vacation leave account of each state employee shall be balanced as of 11:59 p.m. Central Standard Time on December 31 each calendar year. Each state employee shall be entitled to have accumulated as of such time the number of hours of vacation leave which he or she earned during that calendar year. Hours of vacation leave accumulated in excess of that number shall be forfeited. Any state employee shall be entitled to use any vacation time as soon as it has accrued. Any vacation time not used within one calendar year following the calendar year during which the time accrued shall be forfeited. In special and meritorious cases, when to limit the annual leave to the period therein specified would work a peculiar hardship, such leave may be extended in the discretion of the Governor, or in situations involving employees of the Legislature, in the discretion of the Executive Board of the Legislative Council.
(7) It is the responsibility of the head of an employing agency to provide reasonable opportunity for a state employee to use rather than forfeit accumulated vacation leave. If a state employee makes a reasonable written request to use vacation leave before the leave must be forfeited under this section and the employing agency denies the request, the employing agency shall pay the state employee the cash equivalent of the amount of forfeited vacation leave that was requested and denied. Such cash payment shall be made within thirty days after the requested and denied vacation leave is forfeited under this section. Such cash payment shall be considered compensation for purposes of a state employee's retirement benefit in a defined contribution or cash balance benefit plan administered by the Public Employees Retirement Board but shall not be considered compensation for purposes of a state employee's retirement benefit in any other defined benefit plan administered by the Public Employees Retirement Board. In determining whether a state employee’s request to use vacation leave is reasonable, the employing agency shall consider the amount of vacation leave requested, the number of days remaining prior to forfeiture during which the state employee may take vacation leave, the amount of notice given to the employing agency prior to the requested vacation leave, any effects on public safety, and other relevant factors. This subsection shall not apply to state employees who are exempt from the State Personnel System pursuant to subdivisions (1)(g) and (h) of section 81-1316.
(8) Each state employee, upon retirement, dismissal, or voluntary separation from state employment, shall be paid for unused accumulated vacation leave. Upon the death of a state employee, his or her beneficiary shall be paid for unused accumulated vacation leave.
(9) A permanent state employee who is transferred from one agency to another shall have his or her accrued vacation leave transferred to the receiving agency.
(10) The Director of Personnel shall adopt and promulgate such rules and regulations as are necessary to administer this section.