Vacation Leave Laws

Currently, there are no federal or state laws that require employers to provide paid vacation time. As a result, employers can create their own policies related to vacation time. This chart identifies state laws that address an employer's ability to limit an employee's accrued vacation leave, implement dates that an employee must use vacation time or lose it (“use-it-or-lose-it” policies), and if they must pay earned, unused vacation time to an employee when separated from employment. Typically, absent a law addressing these matters, an employer can set their own policies.

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StateLaw on Capping Accrued LeaveLaw on "Use-it-or-lost-it" PoliciesPayment of Accrued Vacation Leave at End of Employment
ALABAMADictated by the employment agreement or the employer’s policy
ALASKADictated by the employment agreement or the employer’s policyhttps://labor.alaska.gov/lss/whfaq.htm
ARIZONADictated by the employment agreement or the employer’s policyhttps://www.azleg.gov/viewdocument/?docName=https%3A%2F%2Fwww.azleg.gov%2Fars%2F23%2F00350.htm; https://www.azleg.gov/viewdocument/?docName=https://www.azleg.gov/ars/23/00353.htm#:~:text=When%20an%20employee%20quits%20the,shall%20be%20paid%20by%20mail
ARKANSASDictated by the employment agreement or the employer’s policyArkansas Code Section 11-4-405
CALIFORNIAEmployers can place a cap on the amount of vacation time an individual can accrue.https://www.dir.ca.gov/dlse/faq_vacation.htmEmployers cannot have a "use-it-or-lose it" policy.https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=LAB§ionNum=227.3.Employers must pay earned, unused vacation leave, regardless of the reason for separation. A collective bargaining agreement saying otherwise must be followed.https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=LAB§ionNum=227.3.
COLORADOEmployers can place a cap on the amount of vacation time an individual can accrue.https://cdle.colorado.gov/wage-and-hour-law/vacationEmployers cannot have a "use-it-or-lose it" policy.https://cdle.colorado.gov/wage-and-hour-law/vacationEmployers must pay earned, unused vacation leave, regardless of the reason for separation.https://cdle.colorado.gov/sites/cdle/files/Colorado%20Wage%20Act%20Revised%201.1.2023.pdf
CONNECTICUTEmployers must follow the terms of their policy or employment agreement related to the employee's accrued, unused vacation time and other fringe benefits as wages, but cannot pay less than the earned average rate for the accrual period. This law is enforced by the Connecticut Department of Labor.https://www.cga.ct.gov/current/pub/chap_558.htm#sec_31-76k
DELAWAREEmployers do not have to pay earned vacation if the employer's policy is silent on paying earned, unused vacation leave. Employers must follow the terms of their policies to pay for earned, unused vacation leave.https://delcode.delaware.gov/title19/c011/index.html
*DISTRICT OF COLUMBIAAn employer may only cap the amount of vacation leave an employee may accrue if the employee has knowingly agreed to the policy or a contract that implements the cap.NRA v. Ailes, 428 A.2d 816 (D.C. App. 1981).Employers must pay earned vacation time, unless there is an agreement stating the employer will not pay earned vacation time.https://does.dc.gov/sites/default/files/dc/sites/does/page_content/attachments/FAQs%20for%20OWH-Final.pdf
FLORIDADictated by the employment agreement or the employer’s policy
GEORGIADictated by the employment agreement or the employer’s policy
HAWAIIEmployers are not required to pay out unused vacation time upon separation from employment unless there is an express agreement or uniform custom to do so.
IDAHOEmployers must pay accrued vacation to an employee if the employer's policy or contract requires it.https://casetext.com/case/ferguson-v-city-of-orofino
ILLINOISEmployers can have a "use-it-or-lose-it" policy, but must permit employees a reasonable opportunity to use the leave.https://www.ilga.gov/commission/jcar/admincode/056/056003000B05200R.htmlEmployers must pay all earned vacation. Employers cannot maintain a policy or employment contract requiring that employees give up accrued vacation upon separation from employment for any reason. The only exception to this rule is if a collective bargaining agreement says otherwise.https://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2402&ChapterID=68
INDIANAEmployers can place a cap on the amount of vacation time an individual can accrue.https://kb.dol.in.gov/Employers must pay accrued vacation to an employee if the employer's policy or contract requires it.https://kb.dol.in.gov/
IOWADictated by the employment agreement or the employer’s policyhttps://law.justia.com/codes/iowa/2021/title-iii/chapter-91a/section-91a-4/?current=1
KANSASEmployers can restrict payment of vacation benefits in their vacation policy.https://www.dol.ks.gov/employers/workplace-laws/workplace-laws-faqs
KENTUCKYIf employers have a policy of vested vacation pay, they must pay vacation pay if the employee is terminated or leaves voluntarily. Employers are not required to pay employees for vacation pay that has not been earned as defined by their vacation policy.https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=32050
LOUISIANAEmployers can have a "use-it-or-lose-it" policy at the end of the year as long as the policy is clear and employees have the opportunity to use ithttps://casetext.com/case/wyatt-v-avoyelles-parish-school-bdEmployers cannot refuse to pay earned vacation time, regardless of the reason for separation.https://www.legis.la.gov/legis/Law.aspx?d=83945
MAINEEmployers can have a "use-it-or-lose-it" policy at the end of the year as long as the policy is clear and employees have the opportunity to use ithttps://casetext.com/case/gibson-v-power-maintenance-internationalEmployers must pay earned, unused vacation leave, regardless of the reason for separation. A collective bargaining agreement saying otherwise must be followed.https://law.justia.com/codes/maine/2021/title-26/chapter-7/subchapter-2/section-626/?current=1
MARYLANDIf an employer provides paid vacation leave and the policy or contract is silent on payment after termination, the employer is required to pay an employee their unused, earned vacation leave.https://mgaleg.maryland.gov/mgawebsite/laws/StatuteText?article=gle§ion=3-505&enactments=false
MASSACHUSETTSEmployers can place a cap on the amount of vacation time an individual can accrue.https://www.mass.gov/doc/attorney-generals-advisory-on-vacation-policies/download#:~:text=An%20acceptable%20variation%20of%20an,all%20or%20part%20of%20it.An employer can have a "use-it-or-lose-it" policy, but must permit employees a reasonable opportunity to use the leave.https://www.mass.gov/doc/attorney-generals-advisory-on-vacation-policies/download#:~:text=An%20acceptable%20variation%20of%20an,all%20or%20part%20of%20it.Employers must pay earned leave, regardless of the reason for separation. Employers cannot enforce a vacation leave policy where an employee gives up their earned vacation on separation.https://malegislature.gov/Laws/GeneralLaws/PartI/TitleVII/Chapter41/Section111E
MICHIGANEmployers 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 willhttp://www.legislature.mi.gov/(S(2tutiumtjnnqd1tdllozsyep))/mileg.aspx?page=getobject&objectname=mcl-408-474
MINNESOTAThe employer's policy determines what vacation pay is due.https://www.revisor.mn.gov/statutes/cite/181.74
MISSISSIPPI
MISSOURI
MONTANAEmployers can place a cap on the amount of vacation time an individual can accrue.https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-faqEployers are not allowed to implement a "use-it-or-lose-it" policy for earned vacation time.https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-faqEmployers must pay earned vacation leave, regardless of the reason for separation. Once an employee earns vacation leave, it cannot be forfeited for any reason.https://erd.dli.mt.gov/labor-standards/wage-and-hour-payment-act/wage-and-hour-faq
NEBRASKAEmployers can place a cap on the amount of vacation time an individual can accrue.https://nebraskalegislature.gov/laws/statutes.php?statute=48-1229Employers are not allowed to implement a "use-it-or-lose-it" policy for earned vacation time.https://casetext.com/case/fisher-v-payflex-sys-usaEmployers can require employees to meet certain requirements before they can earn vacation leave. Once employees earn vacation, employers cannot deny payment for the vacation leave on separation.https://nebraskalegislature.gov/laws/statutes.php?statute=48-1229
NEVADAThe law doesn’t expressly allow employers to cap the amount of paid leave an employee may accrue, but it allows them to cap an employee’s use of paid leave at 40 hours in a benefit year.https://law.justia.com/codes/nevada/2021/chapter-608/statute-608-0197/?current=1Use-it-or-lose-it policies are allowed for vacation leave, provided that this leave is granted through an employer's own paid time off policy and not the paid time off accrued under state lawhttps://law.justia.com/codes/nevada/2021/chapter-608/statute-608-0197/?current=1Employers must pay earned, unused vacation leave, regardless of the reason for separation. A collective bargaining agreement saying otherwise must be followed.https://law.justia.com/codes/nevada/2021/chapter-608/statute-608-0197/?current=1
NEW HAMPSHIREIf an employer's policy does not specify whether an employee must be paid for earned vacation, the employer generally must pay the employee for this time when the employee separates from employment.https://www.nh.gov/labor/documents/news-lab800-6-7-2016.pdf
NEW JERSEY
NEW MEXICO
NEW YORKAn employer may cap the amount of vacation leave an employee may accrue over time, so long as employees are given prior notice of the policyhttps://scholar.google.com/scholar_case?case=1291739856191939120&q=70+AD2d+283&hl=en&as_sdt=6,45Employers can have a "use-it-or-lose-it" policy, but the employer must notify the employee in writing or by posting it in an accesible area.https://www.nysenate.gov/legislation/laws/LAB/195Employers are required to pay accrued vacation to an employee if their policy or contract requires it or if it is silent on the matter.https://dol.ny.gov/wages-and-hours-frequently-asked-questions
NORTH CAROLINAEmployers can cap the amount of vacation time an individual can accrue. Must specify this in their vacation policy.http://reports.oah.state.nc.us/ncac/title%2013%20-%20labor/chapter%2012%20-%20wage%20and%20hour/13%20ncac%2012%20.0306.htmlEmployers can have a "use-it-or-lose-it" policy, but it must be written in their vacation policy.http://reports.oah.state.nc.us/ncac/title%2013%20-%20labor/chapter%2012%20-%20wage%20and%20hour/13%20ncac%2012%20.0306.htmlEmployers are required to pay accrued vacation to an employee if its policy or contract requires it or if the contract is silent on the matter.https://www.ncleg.net/EnactedLegislation/Statutes/HTML/BySection/Chapter_95/GS_95-25.12.html
NORTH DAKOTAEmployers can have a "use-it-or-lose-it" policy but it must be written in their vacation policy.https://www.ndlegis.gov/information/acdata/pdf/46-02-07.pdfEmployers are required to pay accrued vacation leave. If an employee voluntarily resigns, paying earned vacation leave is not required if: (1) the employee was provided with written notice when hired; (2) the employee has been working for the employer for less than a year; (3) and, the employee gave the employer less than five days notice of resignation.https://www.ndlegis.gov/information/acdata/pdf/46-02-07.pdf
OHIOEmployers can have a "use-it-or-lose-it" policy but it must be written in their vacation policy.https://law.justia.com/cases/ohio/eleventh-district-court-of-appeals/2011/2011-ohio-3752.htmlAn employer's policy determines whether earned, unused vacation is paid on termination.https://casetext.com/case/winters-jones-v-fifth-third-bank
OKLAHOMAEmployers are required to provide vacation pay if its contract or policy specifically requires it.https://oklahomarules.blob.core.windows.net/titlepdf/Title_380.pdf
OREGONAccrued vacation time must be included in an employee’s final wages if the employment policy is open to interpretationhttps://www.oregonlegislature.gov/bills_laws/ors/ors652.html
PENNSYLVANIADictated by the employment agreement or the employer’s policyhttps://www.legis.state.pa.us/CFDOCS/LEGIS/LI/uconsCheck.cfm?txtType=HTM&yr=1961&sessInd=0&smthLwInd=0&act=0329.&CFID=341800948&CFTOKEN=51581063
RHODE ISLANDEmployers must pay earned vacation time if an employee has been employed for at least a year. Prior to a year, employers can require employees meet requirements in order to receive earned, unused vacation leave on separation.http://webserver.rilin.state.ri.us/Statutes/TITLE28/28-14/28-14-4.htm#:~:text=(b)%20Whenever%20an%20employee%20separates,and%20employee%20shall%20become%20wages
SOUTH CAROLINAAn employer's policy determines whether earned, unused vacation is paid on terminationhttps://llr.sc.gov/wage/faq.aspx
SOUTH DAKOTA
TENNESSEEIf an employer's policy provides for paid vacation leave, they must follow their terms of the policy regarding payment of earned, unused vacation on termination.https://advance.lexis.com/documentpage/?pdmfid=1000516&crid=dab74c23-8cd2-48a0-a576-f32547ff36db&nodeid=ABYAACAABAAD&nodepath=%2FROOT%2FABY%2FABYAAC%2FABYAACAAB%2FABYAACAABAAD&level=4&haschildren=&populated=false&title=50-2-103.+Payment+of+employees+in+private+employments.&config=025054JABlOTJjNmIyNi0wYjI0LTRjZGEtYWE5ZC0zNGFhOWNhMjFlNDgKAFBvZENhdGFsb2cDFQ14bX2GfyBTaI9WcPX5&pddocfullpath=%2Fshared%2Fdocument%2Fstatutes-legislation%2Furn%3AcontentItem%3A4X8M-1710-R03K-P262-00008-00&ecomp=8gf5kkk&prid=7c7ebf09-1520-4142-820e-5c35272c2a8e
TEXASEmployers can limit the pay out for vacation leave upon separation. However, employers must follow the terms of their policies.https://statutes.capitol.texas.gov/Docs/LA/htm/LA.61.htm
UTAHEmployers must pay for earned, unused vacation leave if the employee qualifies under the terms of the policy.https://rules.utah.gov/wp-content/uploads/R610-003.pdf
VERMONTIf employers have written policies related to vacation, they must follow those policies.https://labor.vermont.gov/sites/labor/files/doc_library/WH-13-Wage-and-Hour-Laws-2009.pdf
VIRGINIA
WASHINGTON
WEST VIRGINIAemployer may have a policy that it does not pay employees for accrued but unused vacation leave upon separation from employment but only if the policy is clearly stated in established policy or employment contracthttps://scholar.google.com/scholar_case?case=8684627187819056672&q=530+S.E.2d+676&hl=en&as_sdt=6,45Employers must pay for earned, unused vacation leave unless a clear policy or employment agreement provides otherwisehttps://labor.wv.gov/Wage-Hour/Wage_Collection/Documents/Fact%20Sheet/WPCA%20FACT%20SHEET%206%20-%20FINAL%20WAGES%20AFTER%20REVIEW.pdf
WISCONSINEmployers must pay for earned, unused vacation leave unless a clear policy or employment agreement provides otherwisehttps://law.justia.com/codes/wisconsin/2021/chapter-109/section-109-01/?current=1
WYOMINGemployer may have a policy that it does not pay employees for accrued but unused vacation leave upon separation from employment but only if the employee has acknowledged the employer’s forfeiture policy in writinghttps://wyoleg.gov/statutes/compress/title27.pdfEmployers must pay earned, unused vacation leave out based on their terms of their policy.https://dws.wyo.gov/dws-division/labor-standards/frequently-asked-questions/
Last updated2/29/242/29/242/29/24

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