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The video tutorial discusses the difference between vacation time and PTO (Paid Time Off). Vacation time is defined as a specific category of time that employers designate for personal activities such as travel or family time, while it is typically not intended for illness or medical appointments. Currently, vacation time is not federally mandated, and its definition varies by state law. In several states, accrued unused vacation is considered part of wages and may be payable upon termination. For instance, in Colorado, the Colorado Wage Act includes vacation pay in the definition of earned wages.