PTO Payout & Unused Vacation Pay Calculator
Enter unused vacation or PTO hours and your hourly rate — get an instant payout estimate. State-by-state rules and "use it or lose it" policies explained below.
Formula: Unused hours × hourly rate × payout percentage. Example: 40 hours × $25/hr × 100% = $1,000 owed. Note: Not all states require PTO payout — California and Colorado do, most others don't.
Estimated unused vacation pay: —
PTO payout part of your final check? Use the Final Paycheck Calculator. Missing wages beyond PTO? See the Back Pay Calculator.
How PTO Payout and Unused Vacation Pay Is Calculated
The standard formula is: unused hours × hourly rate × payout percentage. Most full payouts use 100%, but some employer policies pay a lower percentage of accrued time. Salaried employees can convert annual salary to an hourly equivalent (salary ÷ 2,080) before calculating.
PTO Payout Example
| Input | Value |
|---|---|
| Unused PTO hours | 60 hours |
| Hourly rate | $22.00 |
| Payout percentage | 100% |
| Estimated PTO payout | $1,320.00 |
State PTO Payout Laws: Which States Require Vacation Pay at Termination
Whether your employer must pay out unused vacation or PTO depends entirely on your state. There is no federal law requiring PTO payout — the rules are set at the state level:
| State | Payout required? | Key rule |
|---|---|---|
| California | Yes | Accrued vacation is treated as earned wages — must be paid at termination. "Use it or lose it" policies are illegal. |
| Colorado | Yes | Accrued vacation must be paid out unless a written policy says otherwise and was disclosed before accrual. |
| Illinois | Yes | Vacation pay is a form of wages under the Illinois Wage Payment Act — must be paid at separation. |
| Massachusetts | Yes | Accrued vacation must be paid on termination. No "use it or lose it" allowed. |
| Montana | Yes | Vacation pay must be paid out at separation. |
| Texas | Only if promised | No state mandate — payout only required if employer policy promises it. |
| Florida | Only if promised | No state mandate — employer policy controls. |
| New York | Depends on policy | No state law requires payout, but if the employer's policy promises it, failure to pay is a wage violation. |
| Canada (federal) | Yes | Vacation pay is a statutory entitlement — minimum 4% of gross wages (2 weeks) for most employees, more with seniority. |
State laws change. Verify current rules with your state labor department. If your state requires payout and your employer refused, that is a wage violation — use the Back Pay Calculator to estimate the amount owed.
"Use It or Lose It" PTO Policies: What's Legal
Many employers have "use it or lose it" policies that forfeit unused PTO at year-end or on termination. Whether these are enforceable depends on your state:
- Illegal in California, Colorado, and Montana: Because accrued vacation is treated as earned wages in these states, any policy that forfeits earned vacation is void — regardless of what the employee handbook says.
- Generally enforceable elsewhere: In most other states, "use it or lose it" policies are legal if clearly disclosed in writing before the time was accrued.
- Caps on accrual are different: Even in California, employers can cap how much PTO you accrue going forward — they just can't take back what you've already earned.
If your employer applied a "use it or lose it" policy in a state where that's illegal, the forfeited hours may still be recoverable as unpaid wages.
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Frequently Asked Questions
What is unused vacation pay?
Unused vacation pay is compensation owed for earned but unused vacation time or PTO when employment ends, subject to applicable laws and policies.
Is unused vacation pay required?
It depends on your state. California, Colorado, Illinois, Massachusetts, and Montana treat accrued vacation as earned wages — payout is required at termination regardless of employer policy. Most other US states only require payout if the employer's written policy promises it. In Canada, vacation pay is a statutory entitlement under federal and provincial employment standards. See the state payout rules table above for details.
How is unused vacation pay calculated?
Multiply unused vacation or PTO hours by your regular hourly rate, then apply any payout percentage from your employer's policy. Full payout is 100% — some policies pay a lower percentage. For example, 40 unused hours at $25/hr at 100% payout = $1,000. Salaried employees can divide annual salary by 2,080 to get an hourly equivalent. Use the calculator above for your specific numbers.
Is this calculator legally accurate?
This calculator provides an estimate only. It does not account for all state-specific rules, employer policy variations, or contractual terms. For states where payout is legally required and your employer has refused, consult an employment attorney — withheld vacation pay is treated as unpaid wages in those states and is recoverable.
Is PTO different from vacation pay?
PTO is a broader category that may include vacation and sick time. Whether unused PTO is paid out depends on the employer’s policy and local laws.
Is unused vacation pay taxable?
Yes. When paid, unused vacation pay is generally treated as taxable income.
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