Human Resource Blog

New York Vacation

	Benefits
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	Termination
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In New York, is an employer required to pay workers for accrued vacation upon termination? If not, how can an employer change the company policy on vacation pay?

New York currently has no law requiring employers to pay a terminated worker for accrued vacation. There is no federal law, either, which means the law varies from state to state, and can be a controversial topic.

In Maryland, the Department of Labor claims that accrued vacation pay isn’t wages, therefore the Department doesn’t enforce its payment. A court ruling, however in the Maryland Court Special Appeals stated that accrued vacation is protected by Maryland minimum wage law and has to be paid.

Some states have laws that require employers to pay accrued vacation pay upon termination. Others do not. Some companies who employ workers in several states pay for accrued vacation for all terminated employees, so that all employees in that company receive the same benefits.

Other companies with employees in several states pay accrued vacation upon termination only in states with laws that require it.

In states without such a law, policy regarding pay out varies. Some employers will pay accrued vacation if the worker is laid off, or resigns and gives at least two weeks notice. This policy encourages workers to give notice before leaving the job. Under this type of plan, a worker who is fired would not receive pay for accrued vacation. Other businesses pay for accrued vacation time to everyone except persons fired for gross negligence such as stealing.

No matter what policy the company establishes, it should be put in writing, and applied fairly and evenly to all employees.

Changing company policy is possible only in states where the law doesn’t require a pay-out. A date should be set for the change in policy and a memo sent to all employees far in advance of that date. The memo should detail the changes regarding payment for accrued vacation time and the date the changes become effective. To help ensure all employees are notified, they should be required to sign and return the memo. JH