This is the most screwed-up stance. Benefits, all of them, are part of your compensation from the company. In my mind (not necessarily from a legal standpoint) they're obligated to provide the promised benefits, including vacation time. If they pretend benefits exist and don't let you exercise them, it's not a real benefit, it's a lie. Short-term exceptions are one thing (no, you can't take vacation during our busiest week of the year) but if an entire year passes without them finding a way to take your fully allotted amount of vacation, something is deeply, deeply wrong. It does not matter if they're chronically under-staffed. A year is more than enough time to either address it or come to terms with it and allow the existing employees to exercise their promised benefits.