By Evan Lange
Even if your employer is shutting down, Texas law still requires final pay within six calendar days of a layoff, and you can file a wage claim with the Texas Workforce Commission within 180 days if you aren’t paid. If the company files for bankruptcy, unpaid wages, salaries, commissions and certain vacation, severance and sick pay earned within 180 days before the filing or closing get priority up to $17,150 per employee for cases filed on or after April 1, 2025. Larger employers may also owe 60 days’ notice or pay under the WARN Act. Your 401(k) money is held in a separate trust, not owned by the company. Health coverage may end if the company ends its plan, so act quickly on your options.
When a company closes its doors, employees are often the last to know: a sudden all-hands meeting, a locked building, a final paycheck that bounces. Houston has seen closures across oil services, restaurants, retail chains, healthcare groups and startups. Here’s how to protect the money you’ve already earned.
Under the Texas Payday Law, an employee who is laid off must receive final pay within six calendar days. If you’re not paid, file a wage claim with the Texas Workforce Commission within 180 days of when the wages were due. Unused vacation is owed only if a written policy provides for it. See our guide to unpaid wages in Texas.
Priority claims are paid before most other unsecured debts, but payment isn’t guaranteed if the company has little left.
Employers with 100 or more employees generally must give 60 days’ written notice before a plant closing or mass layoff. Without notice, employees may be owed back pay and benefits for the days of notice they didn’t get. Exceptions exist for unforeseeable business circumstances and some “faltering company” situations, but employers must still give as much notice as practicable. Texas has no separate state WARN law. See the WARN Act in Texas and mass layoffs in Texas.
Yes. The Texas Payday Law requires final pay within six calendar days of a layoff, and you can file a wage claim with the Texas Workforce Commission within 180 days if it isn’t paid.
Wages, salaries, commissions and certain vacation, severance and sick pay earned within 180 days before the filing or closing are priority claims up to $17,150 per employee for cases filed on or after April 1, 2025. Amounts above that are general unsecured claims.
Generally yes. Retirement plan assets must be held in a trust separate from the employer’s assets, so the company’s creditors generally cannot reach them.
Employers with 100 or more employees generally must give 60 days’ notice under the WARN Act before a plant closing or mass layoff, subject to limited exceptions.
Yes. A layoff because the business closed is not a disqualifying reason, so you should apply with the Texas Workforce Commission right away.
The Lange Firm represents employees in Houston and across Texas. Attorney Evan Lange can review unpaid wages, WARN Act notice and severance when an employer shuts down, and other wrongful termination issues.
The company may be closing.
Your claim to what you earned isn’t.
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