At my job, we accrue sick time and it carries over from year to year. When I started at my job 10 years ago, they had a policy that if you left employment for whatever reason you got 1/3 of your sick time paid out to you. A couple of years ago, they changed it to you had to be there 15 years before a certain date which I wasn't even close. So now I'm leaving.
Assuming you work for a privately owned company, the answer is yes. They are permitted to create and administer policies as they see fit - as it pertains to payment of sick time upon termination.
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