Generally, an employer is required to pay laid off employees their final paycheck by the end of the next business day or the next regular payday after the layoff, whichever occurs first. This includes all earned and unpaid wages, such as accrued PTO or vacation pay according to the company’s policy.
However, when an employee is laid off and the employer expects the employee to return within 35 days, the layoff is temporary and not considered to be a termination of employment under final paycheck rules. Wages earned and unpaid during a temporary layoff are not due until the next regularly scheduled payday.
The 35-day clock on temporary layoffs will soon expire for many businesses. A temporary layoff that extends beyond 35 days will be treated as a true and full separation between the employer and laid off workers. This may trigger an employer’s obligation to pay out earned but unpaid wages. Employers who are extending a temporary layoff should treat the extension as a separation of employment and pay laid off employees all wages, commissions, PTO, and vacation pay that are due under the employer’s policy.
Each layoff situation is unique and often presents competing interests and considerations. We encourage employers to proactively reach out to counsel to clarify any remaining questions as to best practices when reevaluating an existing layoff.
For questions about layoffs or any other circumstances created by COVID-19, contact Andrew Schpak or Daniel Walker at 503-228-0500, or at firstname.lastname@example.org or email@example.com.
Electronic Alerts are written by Barran Liebman attorneys for their clients and friends. Alerts are not intended as legal advice, but as employment law, labor law, and employee benefits announcements. If this has been forwarded to you, and you would like to begin receiving Electronic Alerts directly, please email or call Traci Ray at 503-276-2115. Copyright ©2021 by Barran Liebman LLP.
Las Alertas electrónicas son escritas por abogados de Barran Liebman para sus clientes y amigos. Las Alertas no son proveídas como asesoramiento legal, sino solo como anuncios de leyes de empleo, leyes laborales y beneficios de empleo. Si esto ha sido remetido a usted y quisieras empezar a recibir las Alertas directamente, por favor mándanos un correo electrónico o llama a Traci Ray al 503-276-2115. Derechos de autor ©2021 por Barran Liebman LLP.