If an employee gives his two weeks’ notice and he already has two weeks’ vacation pay coming to him, does he earn vacation hours after he has given notice?

The answer depends on what your state law states regarding accrued vacation upon termination of employment, as well as how your company regularly responds to paid time off during employment and after termination.

Paid Vacation is a Benefit

First and foremost, it’s important to consider that paid vacation is a benefit rather than a requirement. Employers don’t have to give paid vacation at all and when they do, they have a fair amount of latitude in deciding how to administer it. For more information on paid vacation being a benefit rather than a requirement, refer to this HR Answer.

State Law and Unused Vacation

If an employee has already accrued vacation hours, whether or not you must pay those hours when the employee is either terminated or given notice, first look to the State Labor Laws, which will guide whether or not you have to pay for earned vacation hours upon employee giving notice.

Company Policy and Unused Vacation

Your secondary source for information on paying out accrued vacation is your company policy handbook. Since employers have latitude to offer paid vacation as a benefit, they also have the ability to determine under what circumstances they will offer it. Your employer handbook should spell out the answer to this question so there are no discrepancies. As always, employers should apply company policy consistently and non-discriminatorily.

Helpful Links:

Vacation/Sick/PTO Laws – SHRM – A list of state laws regarding paid vacation days

Paid Vacation: What Are Your Rights? – NOLO – A legal resource explaining paid vacation entitlements for employees