Virginia vacation and PTO payout law

When the payout is due

No state deadline for fringe benefits. Employees must sue in court, since DOLI returns claims for unpaid fringe benefits. Source: doli.virginia.gov↗ (opens in a new tab)

Penalties

No specific state penalty for vacation payout; DOLI does not enforce fringe benefits, so employees may file a civil suit. Source: doli.virginia.gov↗ (opens in a new tab)

Recent changes

2026 law (HB 5 / SB 199) phases in paid sick leave for nearly all employers from July 1, 2027. Unused leave need not be paid out, but is restored if rehired within 12 months. Source: law.lis.virginia.gov↗ (opens in a new tab)

The law and where to check

The law: Va. Code § 40.1-29 (payment of wages; fringe benefits not enforced by DOLI) (opens in a new tab)

The agency: Virginia Department of Labor and Industry, Payment of Wage Unit (opens in a new tab)

What federal law says

No federal law requires paid vacation or payout of unused vacation. These are matters of agreement between employer and employee, and state law. Source: U.S. Department of Labor↗ (opens in a new tab)

Vacation and PTO payout checklist for Virginia employers

A simple order of work, based on the rules above. It is not a legal checklist.

1. Read your written vacation or PTO policy against the rules above.
2. Make any forfeiture or cap rule clear and in writing, where your state allows it.
3. Track each employee's accrued, unused balance.
4. When someone leaves, pay any vacation owed with the final paycheck on time.
5. Keep a record of the balance paid out.
6. See our final paycheck guide for your state's deadline.

More Virginia employment law guides

• All Virginia employment laws
• Virginia final paycheck law
• Virginia paid sick leave law
• Virginia meal and rest break laws
• Virginia overtime law
• Virginia pay frequency law
• Virginia new hire reporting
• Virginia at-will exceptions

Vacation and PTO payout laws in other states

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Disclaimer: This guide provides general information based on publicly available official sources and is for information only. It is not legal, tax, payroll or employment-law advice and does not guarantee compliance with federal, state or local requirements. Rules can depend on your location, industry, contracts and other circumstances, and laws change. Always check the official source, the relevant government agency or a qualified professional before making a decision. MadyHR.ai accepts no responsibility for any action taken based on this page.

Last checked: October 19, 2026. Every rule and source link on this page was checked against the official government source on this date. Laws change, so always open the source link before you act.