Categorized | Management

What’s in the last paycheck?

No one likes to do it, but sometimes—especially in economic downturns—it is necessary to let employees go. What are your legal obligations regarding the last paycheck?

In Florida, employers are not required to give terminated employees a final paycheck immediately. However, you are paycheckobligated by law to pay them by the time the next paycheck would be due. Florida state law does not require the payment of severance or vacation days since these are considered benefits. However, if your company has a policy concerning vacation time, you should include it in the final paycheck. (For more information on Florida labor laws, go to or call 800-342-3450.)

Severance pay is often granted to employees upon termination of employment. It is often based on length of employment for which an employee is eligible upon termination. The Fair Labor Standards Act does not obligate severance pay. Severance pay is a matter of agreement between an employer and an employee (or the employee’s representative) and is often outlined in an employee handbook.

If you decide to offer a severance package, many employers have the terminated employee sign a release, an agreement not to sue in exchange for receiving certain benefits. If the employee signing that release is an older worker, special rules apply. If the employee is 40 years of age or older, the Older Workers’ Benefits Protection Act dictates what must be included in a release. Among other things, you must give these employees a longer period of time to review the release, allow them to revoke the agreement for a limited time after they sign, and advise them in writing to consult with an attorney.


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