Final pay and unused leave
New York Labor Law 191(3) says that when employment ends, you must pay the wages no later than the regular payday for the pay period during which the termination occurred. The rule is the same whether you fire the employee or they quit. If the employee asks, you must mail the final pay.
- Vacation: New York does not set its own payout rule. Labor Law 198-c requires you to pay benefits such as vacation, holiday and separation pay according to your agreement with employees, and Labor Law 195(5) requires you to give employees your vacation policy in writing or post it. So whether unused vacation is paid at exit depends on what your written policy says. If you do not intend to pay it out, say so plainly in the policy.
- Sick leave: New York's paid sick leave law (Labor Law 196-b) does not require you to pay out unused sick leave at separation.
- Benefits under 198-c, including vacation owed under your policy, must be paid within 30 days after they are due.
Written termination notice within 5 working days
Labor Law 195(6) requires you to notify every terminated employee in writing of two things: the exact date of the termination and the exact date their employee benefits end. The notice must go out no more than five working days after the termination date. Failing to tell someone that their accident or health insurance is being cancelled carries an additional penalty. The New York State Department of Labor publishes guidelines for this letter (LS 46).
- Put the termination date and the benefits end date in the same letter, as exact dates.
- Hand it over at the termination meeting when you can, so the 5-day clock is not a risk.
- The law does not require you to state the reason for the termination in this notice.
Unemployment: the Record of Employment (IA 12.3)
The Department of Labor requires you to give written notice to any employee who is separated from employment, whatever the reason and whether the separation is temporary or permanent. You give it on the Record of Employment (Form IA 12.3) or a form the Department approves. It must show your business name, your New York State employer registration number, the address where the Department should send the Notice of Potential Charges, and a statement telling the employee to keep the form for an unemployment claim.
Health coverage: COBRA and New York continuation
| Situation | Rule |
|---|---|
| 20 or more employees | Federal COBRA: notify the plan within 30 days; the plan sends the election notice within 14 days. |
| Fewer than 20 employees, insured plan | New York state continuation: up to 36 months, at up to 102% of the group premium. The employee asks in writing within 60 days of the later of the termination date or the notice of the right. |
| COBRA coverage running out, insured plan | New York extends continuation so the total can reach 36 months. |
| Self-funded plan | State continuation does not apply. Only federal COBRA, if you are covered by it. |
The benefits end date in your 195(6) letter should match what the plan and the COBRA or state continuation notice say. See when you need to offer COBRA.
Discrimination protections cover every employer
The New York State Human Rights Law defines "employer" to include all employers within the state, so even a company with one employee is covered. That is far broader than the federal 15-employee threshold for Title VII and the ADA. Before firing someone who recently complained, asked for an accommodation, or took protected leave, check that the reason and the timing are well documented.
Layoffs: the New York WARN Act
New York's WARN Act applies to private employers with 50 or more full-time employees in New York State and requires 90 days' advance notice. It is triggered by a plant closing affecting 25 or more employees, a mass layoff of 25 or more employees who make up at least 33% of the workforce at a site, or of 250 or more employees, as well as certain relocations and reductions in hours. The Department of Labor has also clarified how remote workers count. See WARN Act layoffs and the New York HR guide.
Common questions
Does New York require final pay on the last day?
No. Final wages are due by the regular payday for the pay period in which the job ended, and by mail if the employee asks.
What must the New York termination letter say?
The exact date of termination and the exact date employee benefits end. It must be given in writing within five working days of the termination.
Do I have to pay out unused vacation in New York?
It depends on your written vacation policy. Pay it if your policy or agreement provides for it, and if your policy says unused vacation is forfeited at exit, make sure employees were given that policy in writing.
How MambaHR handles this
For a New York termination, MambaHR works out final pay under the state's rules for a person to approve, drafts the separation paperwork, prepares the COBRA continuation notices, and removes system access. Terminations always go to a person to decide, and every change is logged.
Sources
- N.Y. Labor Law 191 (frequency and timing of pay)
- N.Y. Labor Law 195 (notice and record-keeping)
- N.Y. Labor Law 198-c (benefits and wage supplements)
- N.Y. Labor Law 196-b (paid sick leave)
- NYSDOL: Guidelines, letter of termination (LS 46)
- NYSDOL: How to keep your UI costs down (IA 318), separation notices
- NYSDOL: Worker Adjustment and Retraining Notification (WARN)
- NY DFS: COBRA frequently asked questions
- NY DFS: State continuation coverage extension to 36 months
- N.Y. Executive Law 292 (Human Rights Law definitions)
- DOL EBSA: An employer's guide to group health continuation coverage under COBRA
- EEOC: Small business information (coverage thresholds)
Last reviewed October 2, 2026. This page is general information, not legal advice. Laws change and exceptions apply, so check the sources above or an employment lawyer before you act on a specific case.