Legal Question in Employment Law in California

Yes. There is no law requiring an employer to provide paid vacation, or to continue providing it. The only law on vacation is that once it is earned it must be paid, either as vacation or as a pay-out at the end of the employment relationship. It cannot be retroactively reduced or taken away.

Mr McCormick again hits the nail on the head

Yes. It is going to get more common as the ObamaCare goes into effect and the economy tanks.