Payout is the default

Maryland defaults to paying out your unused PTO

Last updated July 31, 2026 · sourced from the Maryland labour department and the US Department of Labor

Does Maryland require PTO payout?

Usually yes. Maryland does not mandate payout in every case, but the default is that accrued PTO is wages owed at separation unless your employer gave you a clear written forfeiture policy in advance. The burden sits with the employer, not you. The controlling authority is Md. Code, Lab. & Empl. § 3-505.

Payout at separation

Payout is the default

If you resign

Next regular payday

If you are fired

Next regular payday

How Maryland treats accrued PTO

Maryland defaults to requiring PTO payout at separation. The employer must have a clear, written forfeiture policy communicated at hire to avoid this obligation — the burden is on the employer, not the employee. Without a written forfeiture policy, the employer must pay out unused leave. The policy must explicitly state that PTO is forfeited at separation.

Authority: Md. Code, Lab. & Empl. § 3-505

Your other Maryland entitlements

PTO payout is one line on your final payslip. These are the other Maryland rules that change what that payslip should total.

Paid sick leave: Maryland mandates paid sick leave under the Maryland Healthy Working Families Act, accruing at 1 hour per 40 hours worked, with up to 64 hours usable per year. Sick leave is NOT required to be paid out at termination in Maryland. Check your sick leave balance .
Minimum wage: The Maryland minimum wage is $15.00/hr , above the federal $7.25 (effective January 1, 2024). Your PTO payout is paid at your own rate of pay, not the minimum, but the minimum is the floor below which no hour may be paid. Maryland minimum wage details .
Overtime: Maryland pays overtime at 1.5x after 40 hours in a week . Unpaid overtime is often owed alongside unpaid PTO, so it is worth checking both before you sign anything. Calculate your overtime .

Work out what Maryland owes you

Enter your salary and unused days to get the gross figure, plus an estimate after withholding, in a format you can paste into an email to HR.

Open the PTO payout calculator

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Frequently Asked Questions

Does Maryland require employers to pay out unused PTO?

When must my final paycheck arrive in Maryland if I quit?

If you resign in Maryland, the deadline is: Next regular payday. If you are fired or laid off instead, the deadline is: Next regular payday. Any PTO your employer owes you should be included in that payment rather than sent separately later.

What can I do if my Maryland employer will not pay?

Put the request in writing first, citing the amount and how you calculated it, because a dated written demand matters if you escalate. If that fails you can file a wage claim with the Maryland labour agency. Maryland does not attach a specific statutory late penalty in our dataset, so the claim is for the wages owed.

Can Maryland employers use "use it or lose it" PTO policies?

Generally yes, provided the policy is in writing and was communicated to you. Maryland does not treat accrued PTO as protected wages in every case, so a clearly disclosed forfeiture or year-end reset can be enforced. An undisclosed or ambiguous policy is much weaker.

Is a PTO payout taxed differently in Maryland?

No. A PTO payout is ordinary wages, so it is subject to federal income tax withholding, Social Security at 6.2%, Medicare at 1.45%, and any Maryland state income tax. Employers often withhold federal tax at the 22% supplemental wage rate on a lump sum, which can make the payout look more heavily taxed than your normal cheque; it evens out when you file.

PTO payout in other states

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