Louisiana — Termination

Louisiana recognizes at-will employment under Article 2747 of the Louisiana Civil Code, which provides that "a man is at liberty to dismiss a hired servant attached to his person or family, without assigning any reason for so doing." Under this doctrine, either the employer or employee may terminate the employment relationship at any time, for any lawful reason or no reason, without notice or cause. The at-will rule applies unless the parties have agreed to a contract specifying a fixed term of employment or are subject to a collective-bargaining agreement. Federal and state anti-discrimination statutes, whistleblower protections, and other statutory exceptions may override at-will employment and prohibit termination for specific unlawful reasons.

Source: La. Civ. Code art. 2747

Louisiana's Wage Payment Act imposes strict deadlines for delivering final wages to terminated employees, with severe penalties for non-compliance. Under La. R.S. 23:631(A)(1)(a), when an employer discharges an employee, the employer must pay all wages due on or before the next regular payday or no later than 15 days following the date of discharge, whichever occurs first. The same dual-trigger rule applies to resignations under La. R.S. 23:631(A)(1)(b): the employer must pay on or before the next regular payday for the pay cycle during which the employee was working at the time of separation, or no later than 15 days following the date of resignation, whichever occurs first.

The statute applies to "any laborer or other employee of any kind whatever," covering all employment relationships regardless of whether the employee is paid by the hour, day, week, or month. Payment must be made at the place and in the manner customary during employment, though the employer may mail the final check to the employee's current address as shown in the employer's records; in that case, mailing the check constitutes payment under La. R.S. 23:631(A)(2).

What counts as "wages due"

The amount due includes all wages earned under the employment terms, plus accrued unused vacation pay if the employee is eligible for vacation pay, has accrued vacation with pay, and has not taken or been compensated for the vacation time as of the date of discharge or resignation (La. R.S. 23:631(D)(1)). Louisiana courts treat accrued vacation as wages, and the statute expressly prohibits forfeit-on-termination clauses: "The provisions of this Subsection shall not be interpreted to allow the forfeiture of any vacation pay actually earned by an employee pursuant to the employer's policy" (La. R.S. 23:631(D)(2)).

Commission, incentive pay, and bonus payments present a narrower definition. Under La. R.S. 23:631(E)(1), such compensation is considered "an amount then due only if, at the time of separation, the compensation has been earned and not modified in accordance with a written policy addressing the commission, incentive pay, or bonus." Employers may adopt written policies that defer payment until a specified payout date regardless of separation, adjust amounts based on order cancellations affecting the commission, or withhold payout until the employer receives the payment that generates the commission (La. R.S. 23:631(E)(2)).

Penalties for late payment

An employer who fails or refuses to comply with the final-paycheck deadline faces liability under La. R.S. 23:632(A) for the lesser of (1) 90 days' wages at the employee's daily rate of pay, or (2) full wages from the time the employee's demand for payment is made until the employer pays or tenders the unpaid wages. Louisiana courts construe "demand" liberally; even an oral demand by telephone is sufficient to trigger the penalty clock. In addition, the court must award the employee reasonable attorney fees, which are taxed as costs to the employer, if a well-founded suit for unpaid wages is filed more than three days after the employee's first demand (La. R.S. 23:632(C)).

The statute includes a good-faith exception: if the court finds that the employer's dispute over the amount of wages due was in good faith but the employer is later found to owe the disputed amount, the employer is liable only for the unpaid wages plus judicial interest from the date the suit is filed (La. R.S. 23:632(B)). If the court determines the employer's failure to pay was not in good faith, the full penalty under subsection A applies.

Exemption for partnership profits interests

As of August 1, 2025, La. R.S. 23:631(F) exempts profits interests granted or issued by an entity taxed as a partnership for federal income tax purposes from the final-paycheck rules in La. R.S. 23:631 and 23:634. This exemption does not extend to entities taxed as corporations or limited liability companies that have not elected partnership treatment for federal tax purposes.

Source: La. R.S. 23:631 Source: La. R.S. 23:632