State rankings
Vacation Payout at Termination by State
Vacation Payout at Termination by State: compare 51 US states on 3 metrics.
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51 states
 Alabama | Alabama does not have any state statute governing the payment of vacation time (see Amoco Fabrics and Fibers Co. v. Hilson, 669 So. 2d 832, 835 (Ala. 1995)). | Not addressed by state statute. | Not expressly provided for by state statute. However, if an employer communicates a paid vacation policy to employees, it may not unilaterally revoke that policy after performance by employees. For example, employees must be specifically notified in advance if the employer dec… |
 Alaska | Alaska law does not specifically address treatment of accrued, unused vacation pay. The issue is a contractual relationship between the employer and employees. | Not addressed by state statute. | Not expressly provided for by state statute. However, if an employer has a policy, promise, or contract to provide paid vacation, the Alaska Department of Workforce Development enforces the employer's own rules for those payments. (Alaska Department of Workforce Development: E… |
 Arizona | Wages include vacation pay when the employer has a policy or practice of paying employees for this time (Ariz. Rev. Stat. Ann. § 23-350(6)). | Not addressed by state statute. | Wages due on separation include vacation pay if the employer has a policy or practice of making those payments (Ariz. Rev. Stat. Ann. §§ 23-350(6) and 23-353). |
 Arkansas | None. | Not addressed by state statute. | Earned, unused vacation must be paid to departing employees if the employer provides paid vacation according to an accrual plan and vacation is earned according to that plan (Oil Fields Corp. v. Hess, 186 Ark. 241 (1932), Waymack v. KCLA, 664 S.W.2d 509 (Ark. Ct. App. 1984)). |
 California | Earned vacation time is considered wages. Vacation time is earned as work is performed. (Cal. Lab. Code § 227.3; Suastez v. Plastic Dress-Up Co., 647 P.2d 122, 128 (Cal. 1982).) | Prohibited. However, employers may impose a reasonable cap the amount of vacation employees can accrue. (California DLSE: Vacation FAQs). | Earned, unused vacation time cannot be forfeited, regardless of the reason for termination, unless a collective bargaining agreement provides otherwise (Cal. Lab. Code § 227.3). |
 Colorado | Employers may establish a vacation pay policy in writing or by custom and practice. Employees must be made aware of the policy. Employers and employees must follow the policy until it changes. Colorado Division of Labor Advisory Bulletins: Vacation.) "Wages" and "compensation"… | Not prohibited. The Colorado Division of Labor (CDOL) provides that a use-it-or-lose-it policy is permissible if: - The policy is included in an agreement between the employer and employee. - The policy does not deprive an employee of earned vacation time or the wages associat… | Any vacation pay "earned and determinable" must be paid on employment separation. The parties' agreement determines when vacation pay is "earned." If the agreement is silent or ambiguous about when vacation becomes "earned," the CDOL will consider: - The employer's historical … |
 Connecticut | If an employer offers vacation time, the amount of vacation time an employee is entitled to is governed by the terms of the employment contract or collective bargaining agreement. "Wages" do not include vacation time (Fulco v. Norwich Roman Catholic Diocesan Corp., 609 A.2d 10… | Not addressed by state statute. | If employment is terminated, employers that offer vacation time must pay the employee's accrued, unused vacation time and other fringe benefits as wages as specified under the contract or agreement (Conn. Gen. Stat. Ann. § 31-76k). |
 Delaware | Vacation benefits are a matter of contract between the employer and the employee (Del. Code Ann. tit. 19, § 1109(a)). | Not addressed by state statute. | If the employer's policy is silent on the issue of paying accrued, unused vacation on termination, the employer is not obligated to pay. However, if the employer's policy or an employment agreement between the employer and employee provides for vacation pay on termination, the… |
 District of Columbia | None. | Not addressed by state statute. | Unused vacation is payable on termination if: - The employer provides vacation time as part of employee compensation. - There is no agreement to the contrary. (See NRA v. Ailes, 428 A.2d 816 (D.C. App. 1981) and Jones v. Dist. Parking Managers, 268 A.2d 860 (D.C. App. 1970).) |
 Florida | None. | Not addressed by state statute. | No state statute addresses payment of accrued vacation on termination. |
 Georgia | None. | Not addressed by state statute. | No state statute addresses payment of accrued vacation on termination. |
 Hawaii | None. | Not addressed by state statute. | Whether an employer must pay for any unused vacation time depends on the terms of any express agreement between the employer and employee or uniform custom (Casumpang v. ILWU Local, 121 P.3d 391, 401 (Haw. 2005)). |
 Idaho | If an employer chooses to provide paid vacation benefits, the employer must comply with the terms of its established policy or employment contract (Idaho Department of Labor: Wage & Hour FAQs). | Not addressed by state statute. | An employer must pay accrued vacation to an employee after separation from employment if the employer's policy or contract requires it (Ferguson v. City of Orofino, 131 Idaho 190 (1998) and Jackson v. Minidoka Irrigation Dist., 98 Idaho 330 (1977)). |
 Illinois | "Final compensation" includes "the monetary equivalent of earned vacation" (820 Ill. Comp. Stat. 115/2). | Not prohibited. However, employees must have a reasonable opportunity to take the vacation and notice of the policy. Employers are also free to determine whether to permit carry-over of unused vacation days year to year, and if so, how many days may be carried over. (Ill. Admi… | If an employment contract or employment policy provides for paid vacation, separated employees are entitled to earned, unused vacation time, unless a collective bargaining agreement provides otherwise (820 Ill. Comp. Stat. 115/2 and 115/5). |
 Indiana | If an employer provides paid vacation, it is considered a type of deferred compensation in lieu of wages and is subject to the state's Wage Payment Statute (Naugle v. Beech Grove City Sch., 864 N.E.2d 1058, 1067 (Ind. 2007)). | Not prohibited (Comm'r of Lab., et al v. Int'l Union of Painters, 991 N.E.2d 100 (Ind. 2013)). | Unless an Indiana employer has an arrangement or policy placing limitations on receipt of vacation pay, a discharged employee is entitled to any earned and unused vacation pay (Ind. Heart Assocs., P.C. v. Bahamonde, 714 N.E.2d 309, 311-12 (Ind. Ct. App. 1999)). |
 Iowa | If an employer chooses to provide paid vacation benefits, it must comply with the terms of its policy or employment contract. Paid vacation benefits are considered "wages" (Iowa Code § 91A.2(7)(b)). | Not addressed by state statute. | An employer must pay a terminating employee for unused vacation only if the employer has a contract, policy, or procedure to pay vacation to departing employees (Iowa Division of Labor: Wage FAQs). |
 Kansas | No state law requires the provision of vacation (Sweet v. Stormont Vail Reg'l Med. Ctr., 647 P.2d 1274 (Kan. 1982)). A vacation policy or practice must be provided in writing or posted if requested by an employee (Kan. Stat. Ann. § 44-320(c)). | Not prohibited (Kansas Department of Labor: Workplace Laws and Requirements: Fringe Benefits). | Employers may restrict vacation policies by, for example, providing that: - Employees only earn vacation on reaching their anniversary date. - Employees who separate before their anniversary date are not entitled to a pro-rata payment. (Kansas Department of Labor: Workplace La… |
 Kentucky | Vacation benefits are a matter of contract between the employer and employee. (Berrier v. Bizer, 57 S.W.3d 271, 281-82 (Ky. 2001).) "Vested vacation pay" is treated as wages (Ky. Rev. Stat § 337.010(1)(c)). | Not addressed by state statute. | If an employer offers "vested vacation pay," employers must pay departing employees the vested, unused vacation pay, whether the employee is terminated or leaves voluntarily. Vested vacation pay is treated as wages. (Ky. Rev. Stat § 337.010(1)(c).) However, if and when vacatio… |
 Louisiana | To be paid for unused vacation time, an employee must, according to the employer's stated vacation policy, both: - Have accrued vacation time. - Be eligible to take the vacation at discharge or resignation. (La. Rev. Stat. § 23:631(D).) | Not prohibited (Wyatt v. Avoyelles Parish Sch. Bd., 831 So. 2d 906 (La. 2002)). | Under the statute, employees must be paid for all accrued unused vacation time on termination regardless of the reason for an employee's termination (Beard v. Summit Inst. for Pulmonary Med. and Rehab., 707 So. 2d 1233 (La. 1998)). However, one Louisiana Court of Appeals court… |
 Maine | Paid vacation time will be treated as wages if, under the terms of employment, the employee is entitled to the vacation pay (Richardson v. Winthrop Sch. Dep't., 983 A.2d 400, 402-03 (Me. 2009)). | Not prohibited. Employees have no right to paid vacation except as provided by the terms of their employment. (Gibson v. Power Maint. Int' l, Inc., 2002 WL 31399791, at *6 (D. Me. Oct. 24, 2002)). | On termination of employment, employers must follow the terms of their established vacation policy (Maine Department of Labor: FAQs: Question 6). |
 Maryland | If an employer chooses to provide paid vacation, it must comply with the terms of its established policy or employment contract. | Not addressed by state statute. | If an employer does not have a written policy that limits pay for accrued, unused vacation to a departing employee, the employee is entitled to the cash value of whatever earned, unused vacation is left. The employer is not required to make these payments if the employer has b… |
 Massachusetts | Paid vacation time is considered wages. Employers must compensate employees for earned vacation time. (Mass. Gen. Law. ch. 149, § 148.) | Not prohibited, but employers must give employees: - Adequate notice of the policy. - Enough time to use the accumulated vacation time before the employer's cut-off date. Employers may also place a cap on vacation accrual. (Elec. Data Sys. Corp. v. Att'y Gen., 907 N.E.2d 635 (… | An employer must pay terminating employees all earned, unused vacation. |
 Michigan | Vacation provided under a written contract or policy is considered a fringe benefit and not wages (Mich. Comp. Laws § 408.471(e)). | Not addressed by state statute. | Employers must pay fringe benefits according to the terms of their written contract or policy and cannot withhold any payments due at an employee's termination unless the employee agrees in writing of his own free will (Mich. Comp. Laws §§ 408.473 and 408.474). |
 Minnesota | If employers grant vacation pay, paid time off or vacation pay constitutes "wages" for wage payment purposes (Minn. Stat. Ann. § 181.13). Employers and employees may contract to the conditions under which employees receive accrued vacation wages in the form of paid time off or… | Not addressed by state statute. | The employer's policy determines what vacation pay is due (Minn. Stat. Ann. § 181.74; Minnesota Department of Labor & Industry: Labor Standards: Termination). |
 Mississippi | None. | Not addressed by state statute. | Employment policy or contract determines vacation pay on termination. For example, an employee who is contractually due vacation pay at the time of his involuntary dismissal has a valid claim for the value of his accrued vacation time (Fuselier, Ott & McKee, P.A. v. Moeller, 5… |
 Missouri | None. | Not addressed by state statute. | The definition of wages for purposes of determining final wages due on termination does not include vacation pay (Monterosso v. St. Louis Globe Democrat Publ'g Co., 368 S.W.2d 481, 488-89 (Mo. 1963); Doores v. Intercontinental Eng'g-Mfg. Corp., 670 S.W.2d 65, 67 (Mo. Ct. App. … |
 Montana | Accrued and earned vacation time is similar to wages (see Langager v. Crazy Creek Products, Inc., 954 P.2d 1169, 1173-1177 (1998)). | Prohibited. However, employers may have a policy that limits the employee's ability to earn vacation pay at a designated level of hours (a maximum cap). Once the employee's earned vacation hours drop below that limit, the employee's ability to earn vacation pay restarts. (Mont… | Employer's policy determines if vacation pay is due on termination (Montana Department of Labor & Industries: Employment Laws, Question 14). |
 Nebraska | Paid vacation is a type of fringe benefit, which is considered wages subject to the Nebraska Wage Payment and Collection Act (Neb. Rev. Stat. §48-1229). | Prohibited (see Roseland v. Strategic Staff Mgmt., Inc., 272 Neb. 434 (2006); Fisher v. PayFlex Sys. USA, Inc., 285 Neb. 808 (2013)). | All earned, unused vacation must be paid to departing employees (Neb. Rev. Stat. §48-1229(6); Roseland., 272 Neb. at 439; Fisher, 285 Neb. at 819; Nebraska Department of Labor Standards: FAQs). |
 Nevada | None. | Not addressed by state statute. | Employers are not required to pay employees for accrued but unused vacation at the time of voluntary or involuntary termination. However, employers should ensure that their approach complies with existing policies and past practice. (Nevada Office of the Labor Commissioner: FA… |
 New Hampshire | If an employer offers vacation pay or other fringe benefits to employees, those fringe benefits are considered wages when due (N.H. Rev. Stat. § 275:43(V)). Employers offering vacation pay and other fringe benefits must notify employees in writing, such as either: - A notice p… | Not prohibited. | If a policy does not specify whether an employee must be paid for accrued, unused vacation, the employer generally must pay the employee for this time when the employee separates from employment (see N.H. Code Admin. R. Lab. 803.03). |
 New Jersey | The New Jersey wage laws do not prescribe that accrued and unused vacation constitutes wages and do not establish any requirements about accruing vacation or carrying it over from year to year. | Not addressed by state statute. | Unused vacation will not be not considered wages unless an employment agreement, union contract, or company policy provides that vacation will be cashed out on termination of employment, in which case an employee may have a claim for vacation pay if the terms of the agreement,… |
 New Mexico | None. | Not addressed by state statute. | Not required by state law; depends on employer policy. |
 New York | If an employer chooses to provide paid vacation, it must comply with its policy or employment contract (N.Y. Lab. Law § 198-c). | Not prohibited, but employers must give employees prior notice of the policy (Glenville Gage Co. v. Indus. Bd. of App. of N.Y., 417 N.E.2d 1009 (N.Y. Ct. App. 1980); N.Y. Lab. Law § 195(5)). | An employer's policy determines whether earned, unused vacation is paid on termination (New York Department of Labor: FAQs). An employer policy may specify that employees lose accrued benefits under certain conditions, as long as employees are given prior notice of the policy … |
 North Carolina | North Carolina employers are not required to provide vacation pay plans for employees (N.C. Gen. Stat. § 95-25.12). However, if an employer does adopt a vacation policy, that policy must address: - How vacation is earned. - How much vacation time may be carried forward from on… | Not prohibited. Employees must be notified in writing of any policy that requires or results in loss or forfeiture of vacation time or pay. Employees who are not notified are not subject to the loss or forfeiture. (N.C. Gen. Stat. § 95-25.12.) | An employer's policy determines whether earned, unused vacation is paid on termination. |
 North Dakota | Employers may provide paid time off, which is considered wages, and includes: - Annual leave. - Earned time off - Personal days. - Any other provisions intended to provide compensation as vacation. (N.D. Admin. Code 46-02-07-02(12).) | Not prohibited, if employees: - Are given a reasonable opportunity to take the vacation. - Have notice of the provision. (N.D. Admin. Code 46-02-07-02(12).) | An employer must pay a terminating employee for earned paid time off at the regular rate of pay earned by the employee before separation. An employment policy or agreement cannot include forfeiture of earned paid time off at separation. (N.D. Admin. Code 46-02-07-02(12).) Howe… |
 Ohio | None. | Not addressed by state statute. | An employer's policy determines whether earned, unused vacation is paid on termination (see Winters-Jones v. Fifth Third Bank, 1999 WL 342215 (Ohio Ct. App. May 27, 1999)). |
 Oklahoma | Vacation pay is considered wages under Oklahoma law (Okla. Stat. tit. 40, § 165.1(4); Okla. Admin. Code § 380:30-1-8(d)). If an employer offers paid vacation benefits, it must follow the terms of its employment policy or contract (Okla. Admin. Code § 380:30-1-8). | Not prohibited (Okla. Admin. Code § 380:30-1-5). | An employer is required to provide vacation pay to departing employees if its contract or policy specifically requires it (Okla. Admin. Code § 380:30-1-5(4)). |
 Oregon | Paid vacation, if offered, is considered wages (see State ex rel. Nilsen v. Or. State Motor Ass'n, 432 P.2d 512 (Or. 1967)). | Not addressed by state statute. | Not required by state law; depends on employer's written policies, agreements and past practices (Oregon Bureau of Labor and Industry: Technical Assistance for Employers: Benefits). |
 Pennsylvania | Wages include fringe benefits, such as vacation pay (43 Pa. Stat. Ann. § 260.2a; Harding v. Duquesne Light, Co., 882 F. Supp. 422 (W.D. Penn. 1995)). | Not addressed by state statute. | An employer's policy or agreement determines whether earned, unused vacation is paid on termination. |
 Rhode Island | Accrued vacation time is considered wages after one year of completed service (R.I. Gen. Laws § 28-14-4(b)). | Not addressed by state statute. | After one year of service, employers must pay separated employees accrued vacation time awarded by either: - A collective bargaining agreement. - Written or verbal company policy. - Any other written or verbal agreement between the employer and employee. (R.I. Gen. Laws § 28-1… |
 South Carolina | "Wages" includes vacation pay (S.C. Code Ann. § 41-10-10(2)). Employers must notify employees in writing of the wages and hours agreed upon, and other related information (S.C. Code Ann. § 41-10-30). | Not addressed by state statute. | An employer's policy determines whether earned, unused vacation is paid on termination (South Carolina Department of Labor: FAQs). |
 South Dakota | None. | Not addressed by state statute. | Not required by state law. |
 Tennessee | Employers are not required to establish a written vacation policy if they choose to provide paid or unpaid vacation (Tenn. Code Ann. § 50-2-103(3)). | Not addressed by state statute. | Employer's policy or labor agreement determines payment of earned, unused vacation on termination of employment (Tenn. Code Ann. § 50-2-103(3); Op. Tenn. Att'y Gen. 06-169 (2006)). |
 Texas | If an employer chooses to provide paid vacation, it must comply with its written policy or agreement (Texas Lab. Code § 61.001(7)(B); 40 Texas Admin. Code § 821.25(a)). | Not addressed by state statute. | Required if promised by employer in a written policy or agreement, subject to conditions imposed in the policy or agreement (Texas Workforce Commission: Accrued Leave Payouts). |
 Utah | If an employer chooses to provide paid vacation, it must comply with its policy or agreement (Utah Admin. Code r. 610-3-4(B)(1)). | Not addressed by state statute. | Unless the employer specifically implements a use-it- or-lose-it policy explicitly stating that leave does not accrue and employees are not paid for unused leave, the employer must pay the employee for any accrued, unused leave on the employee's termination. (Utah Admin. Code … |
 Vermont | Employers who choose to provide paid vacation time, as stated in an employee handbook, memorandum, or other correspondence are liable to their employees for these benefits (Vermont Department of Labor: Summary of Vermont Wage & Hour Laws: Benefits and/or Wage Supplements). | Not addressed by state statute. | An employer's policy determines whether earned, unused vacation is paid on termination. |
 Virginia | Employers may establish any or no policy regarding vacation benefits (Virginia Department of Labor & Industry: Labor and Employment Law). | Not addressed by state statute. | An employer's policy determines whether earned, unused vacation is paid on termination. |
 Washington | There is no state law requiring employers to grant vacation time to employees. If an employer offers paid vacation time, the terms of the employer's policy or employment contract governs the amount of vacation time to which the employee is entitled. (Walters v. Ctr. Elec., Inc… | Not addressed by state statute. | An employer's policy determines whether earned, unused vacation is paid on termination (see Washington Department of Labor & Industry: FAQs: Final Paycheck). |
 West Virginia | Accrued vacation and similar benefits constitute "compensation for work performed," which must be paid to an employee (Farley v. Zapata Coal Corp., 281 S.E.2d 238, 241 (W.Va. 1981)). | Not addressed by state statute. | Accrued vacation does not constitute "wages" within the statutory definition to be paid on discharge if the employer has a written policy stating that accrued vacation will not be paid in cash on termination. |
 Wisconsin | Wage payment includes holiday and vacation pay (Wis. Stat. § 109.01(3)). The statute does not specify how vacation time must be administered. | Not addressed by state statute. | Not required by state law. |
 Wyoming | If an employer chooses to provide paid vacation benefits, it must comply with its policy or employment contract (Wyo. Stat. § 27-4-507). | Not addressed by state statute. | An employer must provide terminating employees with accrued, unused vacation pay earned according to the employer's policy (Wyoming Department of Workforce Services: Labor FAQs) |
Quick answers
- Where does this vacation payout at termination by state data come from?
- Rankodex compiles it from World Population Review and the primary sources it cites: Vacation Pay State Laws Chart: Overview - Ask Legal Solutions.