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Feb11

Virginia Vacation Pay

Is there any Virginia law that requires employers to pay terminated employees for accrued vacation time?

Most states in America, including Virginia, do not require companies to pay employees for any accrued vacation time upon termination.  State law maintains that employers have the right to establish any type of policy that they so choose in regards to vacation time.  This includes the right to stipulate whether or not workers are entitled to receive payment for accrued vacation upon termination.

The law, however, does not require companies to give benefits, such as vacations, to employees.  If companies have policies stating that employees are to be paid for accrued vacation time, then the law requires that company to honor the policy.  Employee handbooks should contain all of the necessary information in regards to vacation policies.

It is important to mention that employers cannot discriminate in awarding benefits based on criteria such as color, sex, race, pregnancy, religion, age (over 40), national origin, or disability. 

The various state laws regarding vacation pay upon termination can vary a great deal.  There are nine states, including Tennessee, Illinois, Oregon, Rhode Island, Massachusetts, North Carolina, Maine, Louisiana, and California that require employers to compensate workers for accrued vacation time, upon termination.  This rule applies whether an employee is laid off, quits, or is fired.

Oklahoma, as well as a number of other states, has laws that require employers to honor any promises that have been made to employees.  In these states, should an employee handbook state that workers are to be paid for accrued vacation time upon termination, then the policy would be enforced by the state Department of Labor.

Courts in Indiana and North Carolina assume that employees are entitled to accrued vacation pay.  The only exception would be if there was a written policy stating that employees would not receive this type of pay.  Such policies have to spell out the exact circumstances under which the employee will lose his or her vacation pay. JH

This entry was posted on Monday, February 11th, 2008 at 12:05 pm and is filed under
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57 Responses to “Virginia Vacation Pay”

  1. Debbie Says:

    Excellent research. Answered my question thoroughly.

  2. Mike Davis Says:

    I worked in VA for [employer name deleted] which is in the process of closing the factory. Even though they are laying off 1500+ people with no notice given to the employees, but that is another story. They promised to pay our PTO upon termination (considering they gave no severance or 60 days of pay) and I want to make sure they are legally obligated. Since the company operated 24 by 7 and 365 days a year there were no company holidays or vacation/sick days, just PTO which was accrued bi-weekly.

  3. Caitlin Says:

    Hi Mike!

    There is no law in Virginia that requires an employer to pay workers for unused PTO upon termination. If the company has recently promised, in writing, to pay workers PTO upon termination due to the plant closure, you may be able to take them to court or small claims court and force them to comply.
    Normally employers must give workers 60 days notice of plant closures or layoffs involving more than 50 people, under federal WARN notices. However, when a company faces sudden business reversals or goes out of business, those regulations may not apply. In some cases when a company faces business reversals or goes out of business, they are also unable to meet other obligations, such as paying PTO. HTH, and thanks for reading the blogs!~ Caitlin

  4. Dawn Says:

    Ok I live in Virginia and I quit my job a couple of weeks ago. I didn’t receive any vacation time that was accued over the 3 years I was there on my final pay check. I had my 3yr review and it stated in a written statement that I received 3 weeks vacation. There is no where in the employee handbook that states I would not be paid for the vacation days upon termination. What is my right in this matter can I have him pay me for the 2 weeks vacation that I accued and didn’t use??

  5. Caitlin Says:

    Hi Dawn! About a dozen states that have laws requiring that an employer pay workers for any unused vacation upon termination. Virginia does not.
    If the employer had a written policy that they will pay unused vacation on termination, you would be able to take them to small claims court. The same is true if they had a past practice of paying the vacation at termination. But this is entirely a matter of company policy in Virginia. HTH, and thanks for reading the blogs!~Caitlin

  6. Jennifer Says:

    If your company is CA based and you work at a VA site, the handbook only states you get PTO and how you get it not if it is or is not paid out at the time you leae can you do anythign about it? It didny say it wouldnt be paid out ? ? ? Any recommendations? I am leaving with proper notice.

  7. Caitlin Says:

    Hi Jennifer! Unfortunately,no. The company is obligated to pay terminated employees for unused vacation, in California. However, the company is not obligated under Virginia law to pay terminated employees for unused vacation time. It is perfectly legal for a company to treat Virginia employees differently than California employees. If the company had a written policy that they would pay all employees for unused vacation, then they would have to honor it. HTH, and thanks for reading the blogs!~ Caitlin

  8. Dave Says:

    Hi. My company does pay for vacation after termination. I recently resigned and they are preparing to pay me. Here is my question: I took a paycut a year ago. I have accrued vacation days under my old larger pay. My employer says they pay vacation out at a rate that is the current rate of pay when an employee terminates. Do I have a claim that some of my vacation should be paid at the pay rate I was making when the vacation accrued?

  9. Dave Says:

    As a further fact, my employer does not have a written policy about the rate at which they pay unused vacation. But it apparently has always been their practice to pay it out at the employee’s rate at the time of termination of employment.

  10. Caitlin Says:

    Hi Dave!
    This is standard HR policy. Vacation is always paid out at the employee’s current rate, whether that is higher or lower than when the employee accrued the vacation. Only California has a law that the vacation must be at the same rate as when it was earned. HTH, and thanks for reading the blogs!~ Caitlin

  11. Cheryl Says:

    I was recently laid-off, worked in Virginia. Our company policy states that severance will be paid at the rate of 1 week for each year worked and unused vacation will be paid out. The employer previously paid out all severance and vacation in last paycheck, when we were laid off they indicated we would be paid by a subsidary of the company out of Wisconsin on our regular pay periods.For me that is over the next 16 weeks and that vacation will be paid with last severance pay check.

    If this was not the previous way the company paid out in the past, is it legal for them to do it know and through the subsidary that I did not work for?

    Thany you

  12. Caitlin Says:

    Hi Cheryl! Yes, this is legal and even generous. Sounds like the company is having financial problems. In that case, they are under no obligation to give severance pay, at all. ~ Caitlin

  13. Joe Says:

    In Virginia, if written company policy is to pay the employee for accrued vacation in the last paycheck, is the employer legally required to do so under Virginia law. It took me several phone calls and e-mails before I could get my firm to pay me the vaction pay after I resigned.

    Thank you.

  14. Caitlin Says:

    Hi Joe! Yes, if the employer has promised in writing to pay accrued vacation, that probably qualifies as a contract under Virginia law. However, in Virginia the employee would have to take the employer to small claims court — the Department of Labor will not assist in collecting that payment. HTH, and thanks for reading the blogs!~ Caitlin

  15. Manshi Says:

    My wife worked in Fairfax Virginia for a local grocery store chain for ninteen years. on Nov. 2008, she was wrongfully terminated on false charges. Her union local 400 did not support her. We hired a lawyer to get her job back. We spent thousands of dollars but she did not get justice form the store or the Union Local 400. The grocery store did not give her personal days and two weeks unused vacation. The Union lawyer said that she can only get her vacation and personal days if she admits that she was wrong and she made mistake. Why should she admit? She did not do any thing wrong. They made her scapegoat. We spent thousands of dollars to get her job back, not for her unused vacation. our lawyer suggested to file complaint to NLRB and Virgina Labor Board for her unused vacation and personal days. Please suggest us what should we do? Thanks.

  16. Caitlin Says:

    Hi Manshi! Your wife should look for a new job because you have lost the lawsuit for wrongful termination. Unfortunately, there is no Virginia law that requires the employer to pay terminated workers vacation or personal days. If the employer has a written policy to do so, you should take them to small claims court — no attorney required. HTH, and thanks for reading the blogs!~ Caitlin

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  38. Caitlin Says:

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  39. Michele Says:

    So what happens if the employer does not have a policy about paying vacation time either way? My previous employer had no policy stating that they would pay vacation time after termination or not…so what are my options if they choose to not send me the accrued 2 weeks? Am I out of luck because they did not document or are they?

  40. Caitlin Says:

    Hi Michele! Yes, in Virginia the policy does not need to be in writing. If the employer has a policy of not paying vacation at termination, you are pretty much out of luck. However, if they have paid vacation at termination to other employees in the past, then you may have a discrimination suit. HTH, and thanks for reading the blogs!~Caitlin

  41. marie Says:

    I resigned from my job on May 21, 2010. I have nearly 300 hours of unused vacation and personal holiday hours. I was an exempt salary employee in the state of louisiana. Am I entitled to this vacation pay?

  42. William Says:

    So if the employee manual states a person will be paid for unused vacation pay, how long does the employer have to pay this and if he does not pay, what can I do about it.
    Thank you

  43. Caitlin Says:

    Hi William! The vacation pay should be on the next paycheck after termination. If you are having trouble collectinng, you should contact the Virginia Department of Labor, or an attorney. You can also try takinng the employer to small claims court, where no lawyer is necessary. HTH, and thanks for reading the blogs!~Caitlin

  44. susan Says:

    In Virginia,how much notice is a small business owner(5-10 employees)required to give when closing the business?
    Also,there is no handbook or written policy concerning pay out of accrued paid vacation time. The employees are long term (over 30 yrs.)& have received 2 wks. pd. vacation. Does this set a precedent for pay out at the closing of the business.

  45. Caitlin Says:

    Hi Susan! Federal laws require employers with 50 or more workers to give 60 days notice when closing a business or location. However, there is no law that requires smaller employers to give employees any notice at all.

    Nor is there any state or federal law that requires employers to pay workers for unused vacation when the business closes. HTH, and thanks for reading the blogs!~ Caitlin

  46. louise80 Says:

    I am about to get fired for X reason, I have over 200 pto hours, what can I do to get the most of that money paid off, take vacation ?? I have about 1 more month left ,should I resign with 2 week notice ?

  47. Caitlin Says:

    Hi louise80! There is probably nothing that you can do that will make it more likely you will be paid a portion of your PTO at termination. Check your employee handbook, but Virginia employers do not have to pay for unused vacation at termination — and even if they did, only a portion of PTO is considered vacation.

    You could certainly put in a request to use several weeks of vacation time, but the employer has the right to decline that request.

    You may be better off giving two weeks notice, but be aware that any employer can terminate you as soon as you give notice. There is no requirement that they allow you to work out the two weeks or pay you for unused PTO. HTH, and thanks for reading the blogs!~Caitlin

  48. Danielle Says:

    My question is .I been terminated from job and they just sending me a letter.Stating I have unsued vacation time and what is that meaning?/ Thanks

  49. Caitlin Says:

    Hi Danielle! Sorry, but without knowing a little more about the situation its hard for us to tell what this means. It sounds like you have vacation time you had earned but not used while you were employed. This may be good news. You may be entitled to payment for the unused vacation time. You should contact the employer if you have more questions, or post more info and we will try to help. HTH, and thanks for reading the blogs!~Caitlin

  50. Summer Says:

    For a while now, my employer has required that I work more hours than I’m being paid. They have refused to pay overtime and have had me “use” this extra time whenever I have to be out of the office. As a result I haven’t been able to use any of my accrued vacation time. I’ve recently been told that they will be eliminating my position and will be hiring me back on as a contract person with no benefits (so that they no longer have the OT issue). With over a month of vacation time accrued and no way to roll it over once I’m no longer an employee is there anything I can do? From the other posts it sounds like I either have to get them to let me take my last month completely off (not likely) or hope they pay me for it in my last paycheck (also not likely without a good reason). Any words of encouragement for this one? Thanks!

  51. Caitlin Says:

    Hi Summer! As you may know, there is no Virginia law that requires the employer to pay you for unused vacation at termination. Nor are they required to allow you to use the vacation before you are laid off.

    You may have some leverage here. If you are an hourly employee of a business, you are entitled to overtime when you work more than 40 hours in the payroll week. You are also entitled to payment for all the time you work. The employer cannot force you to work more hours than you are getting paid for. (If you are an exempt salaried employee or work for a non-profit organization, then the rules are slightly different.)

    So, by not paying you for all the time you have worked, the employer has broken the law. There are two options open to you. The best option is for you to mention to the employer that you are not quite sure that their past policy was legal under the FLSA, the federal Fair Labor Standards Act. Point out that this (probably illegal) policy results in you not being paid for your vacation time. Let them know that you are willing to overlook this problem, if you are paid for all of your unused vacation at termination. This tactic protects your relationship with the employer, so they will probably continue to hire you as a contractor.

    The other alternative would be for you to file a complaint of unpaid wages (for the time you worked) with the federal or state department of labor. This will trigger an investigation of the payroll records, and may result in you being paid past due overtime. However, it will probably mean the employer will not choose to hire you as a contractor in the future.

    You should decide which tactic is financially the best decision for you. If the employer refuses to pay the unearned vacation, you can always file the complaint. Do not threaten to do that. If you keep your conversation respectful but mention the FLSA or department of labor, they will get the idea.

    By the way, it may not be lawful for them to treat you as an independent contractor, if they control when, where or how you work. And you always have the option of filing for unemployment, either in addition to or instead of working as a contractor. This is a complex issue, so feel free to post more comments with additional details. HTH, and thanks fo reading the blogs!~ Caitin

  52. Gloria Says:

    I was employed with a company in access of 25yrs. I was field management the last 15 yrs. In April I was terminated, not given a reason after an investigation into my having another part time careeer. I was not paid remaining vacation time and the fiscal yr (ending 03/03) bonus paid out in May each yr. I feel I worked hard and earned both the vacation and the bonus pay.
    I know for a fact other field management associates termed before me and one since my term were paid their vacation time. I am in the state of Va., what can I do?
    Thanks, I love your blog!

  53. hrlady Says:

    Hi Gloria,

    Thank You for reading the Humanresourceblog.com!

    In Virginia the Payment of Wage Law states that fringe benefits such as vacation, are not required to be given under the law and employers may establish any or no policy regarding fringe benefits.

    You should contact the Human Resource Department and ask them to explain their procedure, if any, for vacation payout. It may be an oversight on their part or you may simply not have any vacation entitlement left.

  54. Sam Says:

    I was laid off last week from a small company, along with seven others. We were told we may be brought back on after the election. Business is slow. In Virginia what is available to me as far as resources. I am single and have to make it on my own. I really want to stay in the field of work I have previously had.

  55. hrlady Says:

    Hi Sam,

    While you are searching for new employment you should apply for State Unemployment Benefits. The State of Virginia has a online service to answer all your questions regarding unemployment benefits.

    Good luck in your job search. And thank you for reading the Humanresourceblog.com

  56. Prashanth Reddy Says:

    Hi,

    I do understand Virginia Employment law not entitling to pay accrued vacation.
    1) I had accrued vacation of 50+ hours. One of my colleague was paid for his pending vacation. And i was told that Company policy states use or loose. Can I file a complaint in DOL or FLSA under the clause of discrimination?

    2) I emailed resignation on Aug 22, 2012 and I was relieved on the same day. Employment agreement states if an employee wishes to leave should provide 2 weeks of Notice. Even though I provided 2 weeks of notice, company did not honor it. Will I be eligible for any compensation for the notice period?

    Thank you in advance,
    Prashanth Reddy

  57. hrlady Says:

    Hi Prashanth,

    The other colleague you speak about may have left under different circumstances, you should never compare situations.

    You are probably not being discrimination against, before you file with any agency you should discuss your situation with the Human Resource department.

    Thank you for reading the Humanresourceblog.com.

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