Home › Final paycheck letters › Maryland › layoff

Laid off in Maryland: final pay, and what severance does not cover

A reduction in force is still a separation, and severance is not a substitute for wages already earned. In Maryland, a layoff is a termination for this purpose: wages are due on the next scheduled payday.

If you were offered severance in exchange for a release, the release covers claims — it does not convert earned wages into a favour, and it does not move the statutory deadline.

Statute
Md. Code, Lab. & Empl. §§ 3-505, 3-507.2
If fired
All wages due for work performed before the termination must be paid on or before the day you would have been paid had the employment continued (Md. Code, Lab. & Empl. § 3-505(a)).
If you resigned
Resignation is covered by the same rule: wages due for work already performed are payable on the day you would have been paid had you stayed.
Late-pay penalty
Md. Code, Lab. & Empl. § 3-507.2: once two weeks have passed from the date payment was required, the employee may sue, and if the court finds the wages were withheld without a bona fide dispute it may award up to three times the wage, plus reasonable counsel fees and costs. The multiplier is discretionary, so the letter records the exposure rather than promising it.
PTO
Maryland does not require payout of accrued leave where the employer has a written policy limiting it, notified the employee of the benefit, and the employee is not entitled to payment under that policy (§ 3-505(b)). Absent such a policy, accrued leave is wages due at termination.
Small claims limit
$5,000 for an individual
Last verified
2026-11-03 two sources agree

What to put in the file before you write anything

  1. The layoff notice or WARN letter, which usually states the separation date the employer will rely on.
  2. The severance agreement, read for two things: what it says about final wages, and whether it asks you to release the wage claim itself.
  3. Your accrual balance for PTO, and the employer policy that governs forfeiture in Maryland.
  4. Any commission or bonus plan document, because the payment date in the plan is what an employer will point to.

What the letter does that a phone call cannot

A demand letter fixes three things at once: the amount, the date each item was due, and the date the employer was on notice. Every forum that can help you — the Maryland Department of Labor — Division of Labor and Industry, a small claims judge — starts from those three facts. The letter is built from Md. Code, Lab. & Empl. §§ 3-505, 3-507.2 and your own figures, so the deadline it states is the one that applies to your separation, not a generic thirty days.

If the amount fits inside $5,000, small claims court is usually faster than an agency queue; if it does not, the agency route and a demand first is the cheaper path.

Build the Maryland letter — $9.99 Free: calculate my deadline

Questions

Does accepting severance waive my final paycheck in Maryland?

No. Severance is consideration for a release of claims; earned wages are already owed. A release that purports to cover unpaid wages is a separate question, and one worth reading carefully before signing.

Is my layoff deadline different from a firing in Maryland?

A layoff is a termination for this purpose: wages are due on the next scheduled payday.

Other situations in Maryland

being fired · resigning · unused PTO · unpaid commissions · all Maryland rules

Reviewed 2026-11-03 against the sources listed on the Maryland page. This is a self-help document tool, not legal advice, and no outcome is guaranteed.