Do I have to pay out PTO when an employee leaves?

PTO payout requirements vary significantly by state: **States Requiring PTO Payout:** - California: All accrued vacation must be paid - Colorado: All earned vacation must be paid - Illinois: Must pay if promised - Massachusetts: All earned vacation must be paid - Montana: All earned vacation must be paid - Nebraska: Must pay if promised **States Where Policy Governs:** Most states allow employers to set their own policy regarding payout. If your policy states PTO is forfeited at termination, that is typically enforceable. **Best Practices:** 1. Have a clear written policy on payout 2. Communicate the policy at hire 3. Apply the policy consistently 4. Track accrued vs. used PTO carefully 5. Calculate payout at current pay rate **Important:** "Use it or lose it" policies are banned in some states (California, Montana, Nebraska). Check your state law before implementing such policies.