Final Wage Payment Requirements by State and Municipality

Author: Alice Gilman

State wage payment laws govern when an employer must pay final wages to an employee who has separated from employment. Final pay timing requirements vary widely, not only by state but also within many states' laws, depending on whether the separation from employment is voluntary or involuntary and final or temporary. Sometimes the timing of final pay even depends on the type of work or industry involved. Moreover, employers with remote or multistate workforces must be especially careful to comply with the law of the correct state when paying final wages.

In addition to earnings that are defined as regular wages, final pay may have to include amounts for other earnings like commissions and/or the value of accrued but unused time, such as vacation time or paid sick leave. While some state final pay laws explicitly require payout or forfeiture of these earnings, others may require payout only if required by an employment contract, collective bargaining agreement or applicable policy of the employer. Individual localities of some states also have their own requirements regarding payment of accrued time.

The following chart summarizes each jurisdiction's requirements on when to pay final wages to an employee who has separated from employment, how to treat any accrued but unused time and the penalties that apply if an employer fails to comply with these requirements. A notation of "N/A" means there is no law on the issue in the jurisdiction.

For related information on:

• State Worker Adjustment and Retraining Notification (WARN) Act statutes that require notice be provided to certain employees who will lose their jobs due to mass layoffs or plant closings, see Mini-WARN Laws by State and Municipality; and
• Whether a state allows caps on vacation/PTO (paid time off) accrual and allows use-it-or-lose-it policies, see Vacation and Paid Time Off Benefits by State.