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SPEAKING OBJECTIONS

Am I Entitled to Be Paid Out My PTO When My Employment Ends?

In Texas, generally only if your employer promised it in writing.

No Texas law requires an employer to pay out unused PTO or vacation. Neither does the federal Fair Labor Standards Act. Under the Texas Payday Law, PTO is owed when you leave only if a written policy or written agreement specifically provides for payment.

So find the policy. Read what it says about unused time when you leave. If it says nothing, or won't commit, you're probably out of luck. One employer's PTO letter said the company "may or may not establish a policy to compensate for unused time off." The Texas Workforce Commission (TWC) said that was no payout policy, and the courts upheld it.

"But I earned it." Texas courts have rejected that argument.

The policy also sets the conditions. It can pay people who resign and not people who are fired. It can require two weeks' notice. It can cap how much you build up and wipe out unused days at the end of the year. The employer writes those rules, and it has to follow what it wrote. The one exception TWC names is a policy that's discriminatory.

If the policy promises a payout and you didn't get it, you usually don't need a lawyer. You need the Texas Workforce Commission.

File a wage claim. There's no filing fee and no dollar cap. Attach the written policy and something showing your unused hours, like a pay stub. If TWC finds the money is owed, it goes after your employer to collect it. The Texas Supreme Court has said TWC's procedures "are designed to resolve claims expeditiously and inexpensively."

Hiring a lawyer changes the math. The Payday Law doesn't make your employer pay your lawyer. On a few weeks of PTO, the fee can eat the claim.

You have 180 days to file, counted from the date the pay was due, not from your last day of work, and a good excuse won't extend it. Final pay is due six calendar days after a firing or layoff, or on the next regular payday after you quit. If you lose the first round at TWC, you have 21 days from the order's mailing date to appeal in writing. File online, and file early.

And pick one road. Once a TWC claim reaches a final decision, you can't sue in court for the same money. As the Texas Supreme Court put it, "the claimant selects which horse to ride."

A lawyer is worth it when the amount is large, when you missed the 180 days, when all you have is a verbal promise, when there's an arbitration agreement, when your employer takes TWC's order to court, or when the PTO is part of a firing you think was discriminatory or retaliatory. In that last case, get advice before your PTO claim is final at TWC. If you worked for a government employer, the Payday Law doesn't cover you.

Everyone else, read the policy. If it promises the payout, file the claim.

-Christopher J. McKinney
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