North Dakota — Termination

North Dakota recognizes at-will employment for positions with no specified term. Under N.D. Cent. Code § 34-03-01, either the employer or the employee may terminate an at-will employment relationship on notice to the other party, except when otherwise provided by Title 34. This means employers may generally terminate employees without cause, and employees may resign without cause, subject to statutory exceptions (such as anti-discrimination protections, public policy limitations, and contractual obligations).

Source: N.D. Cent. Code § 34-03-01

North Dakota requires employers to pay all final wages on the employee's next regularly scheduled payday, regardless of whether the separation was an employer-initiated discharge or a voluntary quit. Under N.D. Cent. Code § 34-14-03, "[w]henever an employee is discharged or terminated from employment by an employer, separates from employment voluntarily, or is suspended from work as the result of an industrial dispute, the employee's unpaid wages or compensation becomes due and payable at the regular paydays established in advance by the employer for the periods worked by the employee."

This means an employer has until the next payday that would have applied to the pay period during which the employee's final hours were worked. There is no requirement to accelerate payment, and North Dakota does not impose a shorter deadline (such as immediate payment or payment within 24 or 72 hours) as some states do. The statute treats involuntary terminations and voluntary resignations identically for final-paycheck timing purposes.

Delivery method for involuntary terminations. When an employer discharges or terminates an employee, the statute imposes a specific delivery requirement: the employer must pay those wages "by certified mail at an address designated by the employee or as otherwise agreed upon by both parties." N.D. Cent. Code § 34-14-03. This certified-mail requirement applies only to involuntary terminations; for voluntary separations, or if both parties agree to another delivery method (for example, direct deposit to the employee's existing account, or in-person pickup), certified mail is not required.

Penalty for late payment. If an employer fails to pay final wages by the deadline, the statute authorizes the employee to "charge and collect wages in the sum agreed upon in the contract of employment for each day the employer is in default until the employer has paid in full," capped at thirty days. N.D. Cent. Code § 34-14-03. The penalty stops accruing once thirty days have elapsed from the original due date. This penalty is calculated at the employee's regular contractual wage rate and runs for each calendar day of delay, not just business days.

Inclusion of accrued vacation or PTO. North Dakota law now sets detailed statutory rules for when accrued paid time off (PTO) or vacation must be paid out at separation. Under N.D. Cent. Code § 34-14-09.2, private employers must pay out accrued PTO or vacation unless all the following conditions are met: (1) the employer provided written notice of the limitation at hiring; (2) the employee was employed for less than one year; and (3) the employee gave less than five days’ written or verbal notice of separation. The same section also allows employers to withhold payout of awarded-but-not-yet-earned PTO/vacation if written notice of the limitation was given before the award.

If these statutory conditions do not apply, accrued PTO or vacation must be paid out at separation if the employer’s policy or contract provides for such payment. North Dakota statute does not, as of this writing, categorically prohibit or override vacation/PTO forfeiture policies unless the above conditions are met. There is no statutory statement that wages, once earned, cannot be unilaterally forfeited in the PTO/vacation context. As such, payouts are strictly a matter of the statutory requirements of N.D. Cent. Code § 34-14-09.2 and the employer's written policy or contract. No North Dakota case law or published agency guidance appears to declare a general principle against forfeiture of accrued vacation or PTO if an employer’s policy meets the statutory conditions.

Source: N.D. Cent. Code § 34-14-03 Source: N.D. Cent. Code § 34-14-09.2

North Dakota law treats employment with no specified term as "at will," meaning either the employer or the employee may end the relationship by giving notice to the other party. The controlling statute, N.D. Cent. Code § 34-03-01, does not require any minimum advance notice—there is no statutory requirement for two weeks' notice or any other time period. The statute's language—"on notice to the other"—means that the employment relationship can be terminated as soon as the employer or employee communicates the decision to the other party. Immediate, same-day notice is legally sufficient. There is no requirement under North Dakota law that notice be in writing; it can be delivered verbally or in writing. However, if an individual employment contract, written employer policy, or collective bargaining agreement requires a specific amount of advance notice or a particular form, those terms would govern over the default rule. In the absence of such an agreement or policy, only actual notice—of any length, by any reasonable means—is required. The North Dakota Department of Labor and Human Rights confirms in its published guidance that "no minimum length of notice (for example, a two-week notice) is required" for at-will employment.

Source: N.D. Cent. Code § 34-03-01 Source: ND Dept. of Labor FAQ

N.D. Cent. Code § 34-03-01 establishes that an employment relationship without a specified term is at will and "may be terminated at the will of either party on notice to the other." The statute does not prescribe a minimum advance notice period, nor does it require that notification be given before termination becomes effective. By its plain text, the law allows either party—the employer or the employee—to terminate the relationship at the moment notice is given. There is no statutory waiting period or mandated duration of notice under North Dakota law for at-will employment.

What does "on notice to the other" mean? The statute uses the phrase "on notice to the other," but it does not specify what form the notice must take or that there must be any delay between notice and the effective date of termination. In practice, this means that simply informing the other party (verbally or in writing) at the time of termination is sufficient to satisfy the requirement. No advance or written notice is required unless a separate contract, policy, or collective bargaining agreement imposes one.

If a written agreement (such as an employment contract or union agreement) sets out a required notice period, the contract controls. Absent such an agreement, North Dakota law does not impose an advance notice period for at-will employment terminations.

The statute is otherwise silent on the form notice must take, and does not specify consequences for failure to provide advance notice. No regulation, published court decision, or agency guidance appears to impose greater notice obligations on at-will terminations under state law.

Source: N.D. Cent. Code § 34-03-01

When an employee separates in North Dakota, N.D. Cent. Code § 34-14-03 requires the employer to pay the employee’s “unpaid wages or compensation” at the next regular payday. That statutory phrase does include earned commissions and earned (non-discretionary) bonuses, but it does not include unreimbursed business expenses.

Earned commissions and earned bonuses The North Dakota Administrative Code defines and treats both earned commissions and earned bonuses as compensable elements of wages. Under N.D. Admin. Code § 46-02-07-02(15), an earned bonus is “an amount paid in addition to a salary, wage, or commission” that becomes payable when the employee satisfies the contract or agreement terms. Similarly, an earned commission is “a fee or percentage given for compensation to an individual for completion of a sale, service, or transaction.” Agency determinations, upon separation, must look to "past practices, policies, and entire employment relationship" to decide if commissions or bonuses are earned and thus due in the final paycheck.

Unreimbursed business expenses By contrast, North Dakota law explicitly treats unreimbursed business expenses as not part of wages. The Employer’s Handbook used in unemployment payroll reporting states that “reimbursement by the employer of actual employee business expenses” is among the payments not considered wages. That mirrors the general principle: expense reimbursements are not “compensation” under § 34-14-03, which refers only to remuneration for services rendered.

Summary North Dakota’s final-paycheck obligation — “unpaid wages or compensation” under NDCC § 34-14-03 — must include earned commissions and non-discretionary bonuses, as classified under Admin. Code § 46-02-07-02(15). However, unreimbursed business expenses do not qualify as wages or compensation and are not required to be in the final paycheck under state law.

Source: N.D.C.C. § 34-14-03 Source: N.D. Admin. Code § 46-02-07-02(15) Source: ND Job Service Employer’s Handbook, p. 34

North Dakota law does not require private employers to pay severance to employees upon involuntary or voluntary termination, including in cases of plant closings or mass layoffs. Severance pay (compensation provided beyond final wages owed for hours worked) is not mandated by any North Dakota statute or regulation for private-sector employment. Instead, entitlement to severance in the private sector is solely a matter of contract—arising through an individual employment agreement, an employer's established policy, or a collective bargaining agreement. If no such written promise is in place, there is no independent legal obligation to provide severance.

State employee exception—statutory framework North Dakota law addresses severance only for state officers and employees under N.D. Cent. Code § 54-14-04.3. This statute specifies that state employees are not generally entitled to severance unless the termination is the result of staff reduction, layoff, or other non-disciplinary reasons beyond the employee's control. Even in such cases, severance is not mandatory—the employing agency may provide it as part of a broader “incentive for early retirement” or workforce-reduction plan if the agency's budget allows. The law explicitly excludes voluntary resignation or termination for cause from severance eligibility. There is no parallel requirement for private employers.

No North Dakota mini-WARN or statutory severance Unlike some states, North Dakota has not enacted a "mini-WARN" statute (a state-law counterpart to the federal Worker Adjustment and Retraining Notification Act). The federal WARN Act, which applies to large employers during plant closings or mass layoffs, does not require severance pay but does require 60 days’ advance written notice. Failure to comply triggers a penalty—back pay for the notice period—but not a statutory severance right. See /guides/united-states/termination#warn-act-notice-requirements and /guides/united-states/termination#severance-pay for federal nuances.

Summary: For both private and (unless statutory circumstances apply) public employees in North Dakota, severance pay is optional unless provided by contract, policy, or, for state employees, by agency decision in a narrow layoff context.

Source: N.D. Cent. Code § 54-14-04.3