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Hawaii Vacation and Final Wages

Posted by Tamara

Marianne wonders, “When I leave my employer in Hawaii, will I be paid for my unused vacation time?”

The answer is “Not necessarily.” There is no Hawaii state law or federal law that mandates employers pay terminated employees for their unused vacation leave.

Many companies in Hawaii and elsewhere, however, do offer this benefit. If the employer has established a written policy stating it will pay for unused leave, then it must do so. Written company policies are enforced by most courts. In many situations, the employee can sue the employer in small claims courts to collect their money, often without having to hire an attorney.

If, however, a Hawaii employee works for a company without a payment for unused leave policy, he or she is not entitled to any payment at all.

In the states with laws regarding payment for unused leave at termination, the rules and guidelines can and do vary widely.

For example, in Oklahoma, Wyoming and Indiana, it is assumed that employers will pay workers for unused vacation time upon termination. If an employer does not follow this tenet, it must have an established policy, in writing, outlining the specific circumstances for not paying for unused leave.

For example, an Oklahoma company may deny payment of unused leave for workers who were terminated for misconduct. An Indiana employer might deny payment if the employee does not give appropriate notice (usually two weeks, but can be more or less) before leaving the company.

In the states that mandate payment of unused vacation time, (Illinois, Maine, Rhode Island, Louisiana, Massachusetts, North Carolina, Oregon, Colorado, Rhode Island and Tennessee) the conditions and specifications, again, vary widely.

Some of these states have specified certain scenarios regarding paying for unused leave. California, however, pays employees for their unused vacation time, whether it is vacation time or PTO (Paid Time Off) without exception.







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