Unless an employer has a written policy distributed to all employees clearly delineating that separating employees are not entitled to accrued but unused vacation pay, then such amounts are typically deemed to be “wages” as defined under the South Carolina Payment of Wages Act at 41-10-10(2) of the South Carolina Code of Laws. The result is that employees leaving their job, whether voluntarily or involuntarily are generally entitled to the monetary value of their accrued vacation pay in South Carolina.
The same standard and deadlines that apply to other types of wages under the Unpaid Wage Act apply to accrued vacation. Accordingly, employers must pay separating employees, whether they are terminated or whether they voluntarily quit, the monetary value of their accrued, but unused, vacation pay as calculated on their last date of employment.
An employer’s failure to timely pay a separating employee for their accrued vacation pay, or any other wages for that matter, creates a civil cause of action on behalf of the employee and allows the employee to file suit and recover three times the amount owed to them by the employer, plus attorney’s fees and court costs.
The Payment of Wages Act has clear-cut rules for how final payment for wages, including salary, bonuses, and accrued vacation pay, are to be submitted to employees who leave their job or who are terminated. The Act states that all wages owed to a separating employee must be paid either within 48 hours of the separating employee’s last date of work or by no later than the next regular pay date, whichever date comes later.
South Carolina courts have strictly construed the language of the Wage Payment Act and have interpreted the Act to provide definite safeguards to employees assuring that they are compensated for their work.
In the event that an employer fails to pay all wages owed to a separating employee within the time limits set forth above, the employee may file a civil suit against the previous employer to recover three times the actual amount of unpaid wages owed, plus attorney’s fees and court costs.
The Unpaid Wage Act creates high stakes for employers who do not timely pay all wages and can create liability on behalf of the violating employer well beyond the initial amount of the unpaid wages owed to the employee.