Paying Vacation for Terminated Employees
A matter of state law.
The short answer is "no." Federal law does not require an employer to pay unused vacation time. Most state wage and hour laws permit employers to adopt a policy calling for forfeiture of unused vacation time, but some state laws require payment of unused time. Check with your state labor department for more information.
Source: Epstein, Becker & Green, New York, September 8, 1998.