Wages due upon termination

Q: I was just terminated and I thought I should be paid on my last day of work.  I was told I would be paid on the last day of the month.  Which is it?  I could really use that money now.  I don’t have another job lined up.  I had a ton of vacation accumulated and I earn 4 weeks every year. 

A: In Massachusetts, when an employee is terminated, all wages due must be paid in full on your last day of employment.  I don’t know the specifics of your termination, so consider my response as a general overview of how an employee should be paid if an employee is terminated. 

If an employee resigns, their wages due can be paid in the next payroll cycle.  Maybe this is why your employer may be confused.  It doesn’t matter if they were confused, they’re still required to comply with the Commonwealth of Massachusetts’ laws.  These are not guidelines, but this requirement is the law.  Different states have different requirements.  My response is based on the Commonwealth of Massachusetts wage payment law.  In Texas for example, a terminated employee is required to be paid within six calendar day their termination. I have assumed you are a Massachusetts worker.    

Your employer is required to pay your wages due, which should include your regular pay.  This includes any vacation time earned through your termination date.  Not only should you be paid your regular pay, but you should also be paid any accrued but unused time like your earned vacation time.  Again, this is not optional, it is the responsibility of their employer, whether they know that or not.  However, if you were terminated in July, you would likely only have earned your vacation time on a prorated basis.  Most employers have some vacation accrual policy.  In most cases, your employer can craft their vacation policy in any which way they choose.  Their accrual system may be per day worked, or they may require you to work the entire month before you earn the time.  In your case, you may only have earned around 60% on your vacation time since you did not work a full year, if your vacation policy is earned on a calendar year cycle.  Again, this is assuming you were terminated in July, since your question was received in July.  Many are surprised that an employer is not required to offer vacation as a benefit.  Most employers do offer vacation time, as employers are competing for talent, and it is a norm as part of a benefits package. 

My recommendation on how to handle a termination is that you leave your worksite in a professional manner.  Leaving in an angry or hostile manner may jeopardize a few options that you might want to consider.  There is nothing which prevents you from asking your employer for severance pay.  Severance pay typically includes some wage continuation for a period of time.  Often severance pay is linked to your years of service.  Employers are not required to pay an exiting employee severance pay, but in my opinion is more likely to offer a severance agreement to a former employee if they leave the worksite in a professional manner.  If you leave in a professional manner, you are more likely to convince your employer to provide a position employment reference.  Some employers only give limited references, but some will share that the former employer is not eligible for re-hire.  This statement is a red flag to a prospective employer.    

You may contact the Attorney General’s office.  Two ways to contact at Attorney General’s office are filing a complaint online, or contacting the office by phone.  More information can be found on www.mass.gov.  Additionally, you could contact an employment attorney to further advise you.