Run a dismissal payroll

There are a few things to keep in mind when processing a dismissal payroll—make sure the employee is properly dismissed first. Use the dropdowns below to understand how to process the dismissal payroll.

For an overview of dismissal payrolls, and the compliance regulations behind them, like final pay and PTO, head to this article.

Keep in mind, dismissals can’t be reversed, so make sure that you want to end the employee's employment and remove them from future payrolls.

To dismiss a contractor, head to this article instead.

Dismissal paycheck requirements by state

Employers must make sure they know when to:

  • Legally pay departing employees.
    • Most states require that employers give departing employees their dismissal (or final) paychecks within a set period of time, or even on the employee’s last day of work. In some states, the time period varies depending on whether the employee quit or was fired/laid off. 
  • Pay out unused vacation hours to departing employees (if required). 

Stay compliant

While employers often assume they should pay the dismissal paycheck on the company’s next scheduled payroll, it’s often the case that the payroll is scheduled for after the applicable dismissal payment deadline. This can lead employers to unknowingly violate the law.

The consequences of paying a departing employee late can be significant - ranging from penalties imposed by the state, to extra damages paid to the employee, or even criminal consequences in some states. 

Use the table below to help inform you of whether your state has a specific deadline and/or unused vacation pay requirements. 

  • For additional information about the current requirements, visit your states’ Department of Labor website.
  • If you still have specific questions about whether your termination payment process is compliant, consult an employment attorney.

 

This table was last revised May 17th 2022. 

State

Dismissal paycheck deadline(s)

Is there a requirement for paying out unused vacation?  Additional information
Alabama
  • No statute
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Alaska
  • If employee leaves involuntarily: Within 3 working days.
  • If employee leaves voluntarily: Next scheduled payday that is at least 3 days after the employee gives notice.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Arizona
  • If employee leaves involuntarily: Within 7 working days or the next scheduled payday, whichever is sooner.
  • If employee leaves voluntarily: Next regular payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Arkansas
  • If employee leaves involuntarily: Within 7 working days.
  • If employee leaves voluntarily: Next scheduled payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
California
  • You're required to pay the employee on their last day
  • Yes
  • Employers are required to pay employees any accrued, unused vacation time upon termination.
Colorado
  • If employee leaves involuntarily: Immediately, with some exceptions.
  • If employee leaves voluntarily: Next regular payday.
  • Yes (may depend on an employer's policy)
  • Earned vacation time is considered wages required to be paid out upon termination.
Connecticut
  • You're required to pay the employee on their last day
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Delaware
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Florida
  • No statute
  • No
  • No state statute addresses payment of accrued vacation on termination.
Georgia
  • No statute
  • No (unless otherwise state)
  • You're only required to pay out unused PTO if your company's PTO policy specifies that it will be paid out. Otherwise, you aren't required to pay out unused PTO.
Hawaii
  • You're required to pay the employee on their last day.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Idaho
  • If employee leaves involuntarily: Next scheduled payday or within 10 business days, whichever is sooner.
    • If employee makes a written request for earlier payment, within 48 hours (excluding weekends & holidays) of receiving the request.
  • If employee leaves voluntarily: Next scheduled payday or within 10 business days, whichever is sooner.
    • If employee makes a written request for earlier payment, within 48 hours (excluding weekends & holidays) of receiving the request.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Illinois
  • If employee leaves involuntarily: Immediately if possible, but no later than the next scheduled payday.
  • If employee leaves voluntarily: Immediately if possible, but no later than the next scheduled payday.
  • Yes
  • An Illinois company cannot put into place a company policy that does not pay out PTO upon termination.
Indiana
  • If employee leaves voluntarily: You're required to pay them on the company's next regular payday.
  • If employee leaves involuntarily: You're required to pay them within 10 days of their last day. If you're mailing the final paycheck and you don't have their mailing address, you have up to 10 days after they provide it to you.
  • No
  • You can pay out unused PTO if you'd like, but you aren't required to.
Iowa
  • You're required to pay the employee on or before the company's next regular payday.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Kansas
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Kentucky
  • You're required to pay the employee on or before the company's next regular payday.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Louisiana
  • You're required to pay the employee on or before the company's next regular payday.
  • Yes
  • Earned vacation time is considered wages required to be paid out upon termination.
Maine
  • You're required to pay the employee on or before the company's next regular payday.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Maryland
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • Yes (unless otherwise stated)
  • Employers are required to pay employees any accrued, unused vacation time upon termination unless the employer's written policy states that vacation time will be forfeited upon termination.
Massachusetts
  • You're required to pay the employee on their last day.
  • Yes
  • Employers are required to pay employees any accrued, unused vacation time upon termination.
Michigan
  • MI law says final paychecks must be paid as soon as possible. We recommend paying the employee no later than the company's next regular payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Minnesota
  • If employee quits: You're required to pay them on the company's next regular payday.
  • If employee is fired: You're required to pay them on their last day.
  • If employee is laid off: You're required to pay them within 24 hours of their last day.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Mississippi
  • No statute
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Missouri
  • You're required to pay the employee on their last day.
  • No
  • Employers are not required to pay employees for earned, unused vacation upon termination.
Montana
  • Your company is allowed to pay dismissed employees on the company's regular payday if you have a written policy indicating that this is when final paychecks will be provided.
  • If your company doesn't have that policy in writing, you're required to pay the employee within 4 hours or by the end of the employee's last day—whichever is sooner.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Nebraska
  • You're required to pay the employee on or before the company's next regular payday.
  • Yes
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.

Nevada

  • You're required to pay the employee on their last day.
  • No
  • Employers are not required to pay employees for earned, unused vacation upon termination.
New Hampshire
  • If employee leaves unvoluntarily: Within 72 hours. If employee is laid off, then until the next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday. If the employee gives at least one pay period’s notice, then within 72 hours.
  • No
  • You can pay out unused PTO if you'd like, but you aren't required to.
New Jersey
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
New Mexico

 

  • If employee leaves involuntarily: You're required to pay them within 5 days of their last day.
  • If employee leaves voluntarily: You're required to pay them on or before the company's next regular payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
New York
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
North Carolina
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
North Dakota
  • If employee leavese involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • Yes, in most cases
  • Must pay accrued time off unless employee is leaving voluntary and all of the following apply:
    • Employee has been employed for less than 1 year
    • Policy states that there is a limitation of pay of accrued time off
    • The employee gave the employer less than 5 days verbal or written notice
Ohio
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Oklahoma
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Oregon

 

  • If employee leaves involuntarily: You're required to pay them no later than the day after their last day.
  • If employee leaves voluntarily: You're required to pay them on their last day.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Pennsylvania

 

  • If employee leaves involuntarily: You're required to pay them no later than the day after their last day.
  • If employee leaves voluntarily: You're required to pay them on their last day.
  • If the employee requests that their final paycheck be paid by mail, you must comply.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Rhode Island

 

  • If employee leaves involuntarily: You're required to pay them no later than the day after their last day.
  • If employee leaves voluntarily: You're required to pay them on their last day.
  • Sometimes
  • If the employee has been working for the company for more than one year, you're required to pay out all unused PTO with their final paycheck.
  • If the employee has been working for the company for less than one year, you aren't required to pay out unused PTO. 
South Carolina
  • If employee leaves involuntarily: Within 48 hours or the next scheduled payday, but not to exceed 30 days.
  • If employee leaves voluntarily: Within 48 hours or the next scheduled payday, but not to exceed 30 days.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
South Dakota
  • If employee leaves involuntarily: Next scheduled payday or when the employee returns all the employer’s property (e.g. company phone).
  • If employee leaves voluntarily: Next scheduled payday or when the employee returns all the employer’s property (e.g. company phone).
  • No (unless otherwise stated)
  • Employers are not required to pay employees for earned, unused vacation upon termination.
Tennessee
  • If employee leaves involuntarily: Next scheduled payday or within 21 days, whichever is later.
  • If employee leaves voluntarily: Next scheduled payday or within 21 days, whichever is later.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.
Texas
  • If employee leaves involuntarily: Within 6 days.
  • If employee leaves voluntarily: Next scheduled payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Utah
  • If employee leaves involuntarily: Within 24 hours.
  • If employee leaves voluntarily: Next scheduled payday.
  • No (unless otherwise stated)
  • Employers are required to pay employees any accrued, unused vacation time upon termination unless the employer's written policy states that vacation time does not accrue and will be forfeited upon termination.
Vermont
  • If employee leaves involuntarily: Within 72 hours.
  • If employee leaves voluntarily: Next scheduled payday, or the following Friday if not scheduled payday.
  • No (unless otherwise stated)
  • You're required to pay out all unused PTO with their final paycheck.
Virginia
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Washington
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • There are some exceptions for specific industries.
  • No (unless otherwise stated)
  • An employer’s policy or employee contract governs whether earned, unused vacation is paid upon termination.
Washington DC

 

  • If employee leaves involuntarily, you're required to pay them the day after their last day.

  • If employee leaves voluntarily, you're required to pay them on or before the company's next regular payday or within 7 days of their last day—whichever is sooner.

  • Yes (unless otherwise stated)
  • You're required to pay out all unused PTO with their final paycheck unless your company has a written policy that indicates unused PTO will not be paid out when an employee leaves the company.
West Virginia
  • If employee leaves involuntarily: Next scheduled payday.
  • If employee leaves voluntarily: Next scheduled payday.
  • Yes 
  • You're required to pay out all unused PTO with their final paycheck. 
Wisconsin
  • If employee leaves involuntarily: Next scheduled payday, or within 24 hours if termination occurs as a result of liquidation, merger, disposal, or removal of the business.
  • If employee leaves voluntarily: Next scheduled payday.
  • There are some exceptions for specific industries.
  • No (unless otherwise state)
  • You're only required to pay out unused PTO if your company's PTO policy specifies that it will be paid out. Otherwise, you aren't required to pay out unused PTO.
Wyoming
  • You're required to pay the employee on the company's next regular payday, unless the employment contract indicates otherwise.
  • Yes
  • You're required to pay out all unused PTO with their final paycheck.