Pay an Employee's Final Wages

Key Points

  • State laws and regulations govern when an employer must provide the final wage payment to an employee who is voluntarily separating from employment or being terminated involuntarily, and the civil and criminal penalties for failure to comply.
  • Most state laws require an employer to issue a final wage payment at the time of separation or termination, within a certain number of days after the event, or by the next regular payday.
  • In many states, the timing rules differ for voluntary separations and involuntary terminations. Additional special rules may apply to employers in certain industries and for temporary layoffs, lockouts and strikes.
  • While some states' laws have specific provisions regarding payment of unused, accrued vacation time on separation or termination, other states' laws make it dependent upon the terms of an employer's policy or handbook, an employment contract or a collective bargaining agreement, if any.

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