Louisiana Wage Payment Act (LWPA): Deadlines, Penalties, and Suits

Under the Louisiana Wage Payment Act, found at Revised Statutes 23:631 and 23:632, your employer must pay every wage you’re owed by the next regular payday or within 15 days of separation, whichever comes first. That rule applies whether you quit or were fired. If the employer misses the deadline and ignores a written demand for payment, you can sue for penalty wages of up to 90 days’ pay, plus your attorney fees.

What Has to Be Paid

The statute covers all “amounts then due under the terms of employment.” That means your final regular wages or salary through your last day, along with a few categories workers often miss.

Accrued Vacation

Earned vacation time counts as wages owed, but only if two things are true under the employer’s stated vacation policy: you were eligible for and had accrued paid vacation, and you hadn’t already used or been paid for it.¹ The statute forbids employers from using any policy to forfeit vacation you actually earned. If the handbook says you earn two weeks a year and you have those days on the books, they get paid out.

The phrase to watch is “stated vacation policy.” If the employer has no written policy granting paid vacation, there may be nothing to pay out. Sick leave isn’t addressed in the statute and generally doesn’t have to be paid at separation unless your contract says so.

Commissions, Bonuses, and Incentive Pay

RS 23:631 treats commissions, incentive pay, and bonuses as amounts due at separation, payable according to the terms of your employment agreement or company policy.¹ A commission earned before separation but not yet calculated is still owed once the amount is determined.

Disputed Amounts

If you and the employer disagree about how much is owed, the employer cannot sit on everything while the fight plays out. The statute requires the employer to pay the undisputed portion on time and lets you sue for the rest.¹ Employers regularly get this wrong by holding back a clearly owed final paycheck because of a separate dispute over, say, a bonus. Doing that can trigger penalty wages on the whole amount.

Who Is Covered

RS 23:631 applies broadly to anyone employing workers in Louisiana. The statute reaches “the person employing such laborer or other employee of any kind whatever,” which pulls in private companies, nonprofits, and government offices, and covers full-time and part-time staff regardless of how they’re paid.¹

The act generally does not protect independent contractors working under their own service agreements. The question is whether a genuine employer-employee relationship exists, with the employer directing when, where, and how the work gets done. There’s also one carve-out worth flagging: if a collective bargaining agreement covers you and addresses final pay, that agreement controls instead of the statute.¹

The Deadline Runs on Calendar Days

Whether you resigned or were fired, the employer must pay by the next regular payday for the cycle you were working, or within 15 days of separation, whichever comes first.¹ Those 15 days are calendar days, not business days. Payment must be made at the place and in the manner customary during your employment, or by mail to the current address you have on file.

Sending a Written Demand

You cannot recover penalty wages or attorney fees until you make a formal demand for payment. The statute doesn’t require a specific format, but a good demand letter states the gross amount claimed and breaks it down by category (regular wages, vacation, commissions), identifies the work period or accrual dates, and gives a clear deadline.

Send the letter to the employer’s principal business address by certified mail with return receipt requested, and keep copies of the letter and the mailing receipt. Under RS 23:632, at least three days must pass after your first demand before a lawsuit can trigger the attorney fee award.² Filing on day two can jeopardize the fee award, so the three-day wait is worth respecting.

Penalty Wages and Attorney Fees

RS 23:632 is the enforcement muscle of the act. An employer that fails to pay after a proper demand faces two consequences.

Penalty Wages

The penalty is the lesser of two amounts: 90 days of wages at your daily rate, or full wages from the date of the demand until the employer actually pays.² The “whichever is lesser” matters. If the employer pays two weeks after your demand, penalty wages equal only those two weeks. If the employer stonewalls indefinitely, the penalty caps at 90 days.

A worker earning $150 per day who sends a demand and waits 30 days without payment could claim $4,500 in penalty wages (30 days times $150). That same worker’s maximum penalty is $13,500 (90 days times $150) even if the employer never pays.

Attorney Fees

When a worker files a “well-founded suit” for unpaid wages at least three days after making the first demand, the court must award reasonable attorney fees as costs taxed to the employer.² The award is not discretionary. If you win, the employer pays your lawyer.

The Good Faith Defense

Penalty wages are not automatic. If a court finds the employer’s disagreement over the amount owed was in good faith, the employer owes only the wages plus judicial interest from the date of filing, with no penalty wages.²

This defense turns up when an employer withholds pay because of a real question about commissions owed, authorized deductions, or whether vacation was actually accrued. It does not protect an employer who simply ignores the obligation or refuses to pay an amount that isn’t genuinely disputed. Courts look at whether the employer had a real, articulable reason to believe less was owed, not whether the employer turned out to be right.

Filing Suit and the Three-Year Deadline

The enforcement path under the LWPA is a lawsuit, not an administrative complaint. RS 23:631 lets employees file suit and proceed under Louisiana’s summary proceedings rules, which move faster than ordinary civil cases.¹

Where you file depends on how much you’re owed. Louisiana’s small claims divisions handle disputes up to $5,000, which covers many individual wage claims; larger amounts go to city court or district court.³ Once the employer is served, the default deadline to file an answer is 21 days.⁴

Louisiana’s prescriptive period for recovering unpaid wages is three years from the date the wages should have been paid.⁵ After that, the claim expires no matter how clear-cut it is. Waiting serves no strategic purpose, though. Evidence gets stale, employers close or restructure, and the penalty wage math favors workers who demand payment quickly and follow through.

Taxes on What You Recover

Recovered back wages are taxable income, just as they would have been if paid on time. The IRS treats settlement and judgment payments according to what the payment replaces, and wages replace employment income subject to income tax and payroll withholding.⁶ Penalty wages under RS 23:632 are also generally treated as taxable because they arise from the employment relationship.

Attorney fees add a wrinkle. Even though the employer pays your attorney fees directly as court costs, you may need to report the full judgment (including the fee portion) as gross income and then deduct the fees. For larger recoveries, where combined back wages and penalty wages push you into a higher bracket for the year, a conversation with a tax professional is worth the time.

1
Justia Law. Louisiana Code RS 23-631 – Discharge or Resignation of Employees; Payment After Termination of Employment
2
Justia Law. Louisiana Code RS 23-632 – Liability of Employer for Failure to Pay; Attorney Fees; Good-Faith Exception
3
Louisiana State Legislature. Louisiana Code RS 13-5202
4
Louisiana State Legislature. Louisiana Code of Civil Procedure Art 1001 – Delay for Answering
5
Louisiana State Legislature. Louisiana Civil Code Art 3494 – Actions Subject to a Three-Year Prescription
6
Internal Revenue Service. Tax Implications of Settlements and Judgments