Final Paycheck

Final pay laws vary by state; but, generally, employee rights under state final pay laws entitle employees to receive their final paychecks immediately or in a relatively short time after employment termination or discharge.

For example, your employee rights likely entitle you to receive your final paycheck on the same day that your employment ends, or within 30 days or by the next regularly-scheduled payday after your employment ends.

Because final pay laws vary by state, when your employer must issue your final paycheck might depend on whether you quit, or get fired or laid off. It might also depend on what types of pay your employer owes you.

For example, your final paycheck for earned wages and overtime pay, and reimbursable business expenses that your employer owes you, might be due on the same day that your layoff becomes effective; but, your final paycheck for commissions earned might not be due for up to 30 days from the effective date of your layoff.

If you quit, when your employer must issue your final paycheck might depend on whether or not you gave your employer advanced resignation notice and if so, how much.

For example, your employer might have to issue your final paycheck sooner, such as on your last day of employment instead of by the next regularly-scheduled payday, if you give the minimum advanced resignation notice required by a state final pay law (e.g., 72 hours) or by company policy (e.g., two weeks).

If your employment is "at will", then your employer likely has the right to terminate your employment before your advanced resignation notice period ends. If so, then your employer might not owe you resignation pay for the remainder of your notice period. However, employers still must pay wages already earned by the time final paychecks are due under state final pay laws.

If employers allow vacation leave to accrue by policy, final pay laws in many states require such employers to include accrued vacation pay in employees' final paychecks. Unused paid time off (PTO) that employers have not specifically designated as vacation, sick leave or personal days, is typically treated as accrued vacation pay under state final pay laws.

Severance pay is typically not included in the provisions of state final pay laws. That's because the terms of severance pay are a matter of agreement between employers and employees or employers and unions. The same typically goes for compensation that employers have specifically designated as accrued sick pay.

To discover when your final paycheck is due under a state final pay law, ask the wage and hour (or equivalent) division of the relevant state labor department or browse its Web site. If your employer doesn't issue your final paycheck on time under a state final pay law, then the wage and hour division will likely assist you in collecting it.

You'll probably have to submit some sort of a wage-claim form to get the ball rolling. Regardless, if the wage and hour division is unsuccessful in assisting you, consider consulting an attorney about a lawsuit. Alternately, you may file a claim against the employer in small claims court, for which you don't need an attorney if you so choose.

In some states, if an employer doesn't issue a final paycheck by the time it's due under a state final pay law, then the employer might have to pay a penalty and interest to the affected employee, plus reimburse the employee for attorney and other legal fees incurred to right the wrong.

If you're represented by a labor union under a collective bargaining agreement that stipulates when your final paycheck is due and your employer doesn't issue it on time, then it might be a good idea to check with your local union representative (e.g., shop steward) before taking any other action.

If you're working under an employment contract, such as an independent contractor agreement, but your client doesn't issue your final pay when due according to your contract, consider consulting an attorney about breach of contract.

Whichever potential avenue of relief you take, don't delay for long. A relatively-short statute of limitations likely applies for taking legal action.