What Is Bereavement Pay? A Guide for Employers
What bereavement pay is, whether any law requires it, how many days is standard, the tax treatment, and how a small business writes a policy that works.
What Is Bereavement Pay?
What it is, whether the law requires it, how many days is standard, and how to write a policy before you need one
Nobody writes a bereavement policy in advance. It gets written on the day someone calls to say their mother died, when you have about an hour to decide how many days they get and whether those days are paid, and the person waiting for your answer is having the worst week of their life. That is a bad moment to be inventing a policy, and it is when most small businesses first discover they do not have one.
The other thing you discover in that hour is that the law is less help than you expect. No federal law requires bereavement pay. A few states require bereavement leave, which is not the same thing, and even where it is required it is usually unpaid. Whether your employee gets paid is almost entirely up to you, which means the decision cannot be outsourced to a statute.
This guide is the version to read before you need it: what bereavement pay actually is, how it differs from bereavement leave, what the law requires and does not, how many days is standard, the tax treatment, and how to write a policy in an afternoon so that the next time this happens you already know the answer. Having the policy findable rather than improvised is exactly the kind of thing I built FirstHR to handle. Usual caveat: leave laws vary by state and change, so this is general information rather than legal advice.
What Is Bereavement Pay?
Bereavement pay is wages an employer pays an employee for time taken off following the death of a family member. It is a voluntary benefit in the US, offered because the employer chose to offer it rather than because any law requires it. Most employers do offer some, which is why its voluntary status surprises people.
That last sentence is the whole confusion in this topic, and it is worth slowing down on it, because getting it wrong in either direction is a problem. Employers who believe they are required to pay end up thinking the law made a decision they actually still have to make. Employers who believe they have no obligations at all miss the state laws that do require them to grant the time, whether or not they pay for it.
Bereavement Leave and Bereavement Pay Are Not the Same
Leave is the time. Pay is the money. They are governed differently, and conflating them is the single most common error employers make on this topic.
The practical upshot is that a California employer with eight employees is legally required to give a grieving employee up to five days off, and is legally free to make every one of those days unpaid. Those two facts sit together, and both are true. The law compelled the time; it did not compel the paycheck. Whether the person is paid during those five days is a decision that belongs to you, and it will not be made for you by any statute.
Is Bereavement Pay Required by Law?
No. No federal law requires bereavement pay, and no state law requires it either. Two federal statutes people expect to help here do not.
There is one nuance on FMLA worth knowing. While bereavement itself is not covered, grief that develops into a diagnosable serious health condition, such as depression requiring ongoing treatment, can qualify as the employee's own serious health condition. That is a different legal basis reached by a different route, and it applies only to FMLA-covered employers. It is not a bereavement entitlement; it is a health condition entitlement that a death happened to precede.
So the honest answer to whether you have to pay is no, and the honest follow-up is that almost everyone does anyway. The question is not really a legal one. It is a question about what kind of employer you intend to be when one of your people loses a parent, and the law has declined to answer it for you.
The States That Require Bereavement Leave
A small number of states require employers to provide bereavement leave, and if you employ anyone in one of them, this applies to you regardless of where your company is based. Note carefully that these laws mandate time, not pay.
| State | Who it applies to | What it requires |
|---|---|---|
| California | Employers with 5+ employees, staff employed 30+ days | Up to 5 days per family member, generally unpaid, used within 3 months |
| Illinois | FMLA-covered employers, 50+ employees | Up to 2 weeks unpaid per qualifying event, including pregnancy loss |
| Oregon | Employers with 25+ employees | Up to 2 weeks unpaid per death, capped at 4 weeks per year |
| Maryland | Employers with 15+ employees that offer paid leave | Employees may use their accrued paid leave for bereavement |
| Washington | Covered employers under the state paid leave program | Paid bereavement benefit available through the state program |
| Vermont | Covered employers under the state family leave act | Bereavement is a qualifying reason for unpaid job-protected leave |
California is the one most small businesses encounter first, because its threshold is only five employees. Under AB 1949, employers with five or more employees must provide up to five days of bereavement leave for the death of a family member, for employees employed at least 30 days. The days need not be consecutive but must be completed within three months. And the leave may be unpaid, although the employee may choose to use accrued vacation, sick leave, or PTO to cover it.
The Illinois Family Bereavement Leave Act and the Oregon Family Leave Act both provide considerably more time, up to two weeks, and both are unpaid. Illinois is notable for covering pregnancy loss, failed adoption, failed surrogacy, and unsuccessful fertility treatment, which most employer policies do not. These laws change, several states have active proposals, and the details matter, so confirm the current rules for every state where you actually employ someone. As with most leave questions, the obligation follows the employee's work location, not your headquarters.
How Many Days Is Standard?
Three to five paid days for an immediate family member is the standard, with one to two days for extended family. That is the shape of nearly every employer policy in the US, and it is a reasonable place for a small business to land.
| Relationship | Typical days offered | Notes |
|---|---|---|
| Spouse or domestic partner | 3 to 5 days | The most commonly granted, and the most generous tier |
| Child | 3 to 5 days, sometimes more | Some employers deliberately offer significantly more here |
| Parent | 3 to 5 days | Standard immediate-family treatment |
| Sibling | 3 to 5 days | Usually treated as immediate family |
| Grandparent or grandchild | 2 to 4 days | Commonly a tier below immediate family |
| In-laws | 2 to 4 days | Often overlooked, and often deeply felt when omitted |
| Aunt, uncle, or cousin | 0 to 2 days | Frequently not covered, or covered by PTO |
| Chosen family or close friend | 0 to 1 day | Rare, but increasingly considered by modern policies |
The tiering by relationship is near-universal and it is defensible, but it is worth pausing on where the lines fall. A policy that gives five days for a parent and nothing for a grandparent will eventually meet an employee raised by their grandmother, and the policy will be wrong about that person's life. You cannot anticipate every family, which is an argument for building in a small amount of discretion rather than for writing a longer list.
Who Counts as Family?
Your policy has to define family explicitly, because the alternative is defining it in a phone call with someone who is crying. Most policies cover spouse, child, and parent as immediate family, then extend outward with fewer days.
The definitions worth thinking about carefully are the ones at the edges. Domestic partners should be included; excluding them in a modern workplace signals something you probably do not intend to signal. In-laws are frequently omitted from policies and frequently the source of the most awkward conversations, because a person who has lost a mother-in-law they were close to does not experience that as a technicality. And several state laws, California's included, define family broadly enough that your narrower policy may simply be overridden for those employees anyway.
The pragmatic approach is to define your covered relationships generously, and then add a line saying that additional leave may be granted at management discretion in circumstances the policy does not anticipate. That sentence costs you nothing in most years and gives you room to be decent in the year it matters, which is what discretion is for.
The Coverage Gap Most Policies Miss
Pregnancy and reproductive loss is the largest gap in typical bereavement policies. The great majority of employers offer bereavement leave; a substantially smaller share extend it to miscarriage, stillbirth, failed adoption, or failed surrogacy. That gap is worth closing deliberately rather than by accident.
This is the cheapest meaningful improvement available to most small business policies. It affects a small number of people, it costs almost nothing in aggregate, and to the person it applies to it is the difference between an employer who thought about them and one who did not. If you make one change after reading this, make this one.
How Bereavement Pay Works in Practice
Mechanically, bereavement pay is simple. The employee notifies you, takes the days, and is paid their normal wages for those days through ordinary payroll. There is no special process and no separate system.
The step people get wrong is documentation, and they get it wrong by front-loading it. Asking a person to produce a death certificate before you will let them go to a funeral is a level of process that no small business needs and that employees remember for years. If you want documentation, ask for it on return, allow generous alternatives such as an obituary or a service program, and hold it confidentially.
Is Bereavement Pay Taxable?
Yes. Bereavement pay is ordinary wages, fully taxable, with no special treatment at all. This trips people up because the circumstances feel exceptional, and they assume the tax treatment must be too. It is not.
Bereavement pay is subject to federal income tax withholding, Social Security and Medicare taxes, and unemployment tax, and it is included in the employee's W-2 wages like any other pay. In payroll you simply code it as paid time. There is no exclusion, no separate reporting, and nothing to elect. If you have been treating it as something exotic, stop; it is a normal paid day.
One thing that is genuinely different, and worth not confusing with this: payments made to a deceased employee's estate or beneficiary, such as final wages owed to someone who died, follow entirely separate rules. That is a different situation with different reporting, and it is worth confirming with your payroll provider or a tax professional if you ever face it.
What It Actually Costs You
Almost nothing, which is the argument that should settle this for any small business hesitating on cost grounds. Bereavement is a rare event per employee per year, which makes the expected annual cost across a small team very small even with a generous policy.
Work it through. A team of fifteen people, a policy of five paid days for immediate family, and an average daily wage of $250. If three people in a year lose an immediate family member and take the full five days, that is fifteen paid days, or $3,750. In most years the number will be lower. Against a payroll of well over a million dollars, that is a rounding error.
There is a retention argument available too, and it is real, but I am reluctant to lead with it. People remember how they were treated when a parent died, and they talk about it. That is true, and it is a legitimate business consideration. It is also not the reason to do this, and building a bereavement policy primarily as a retention play tends to produce a policy that feels like one.
Writing a Bereavement Policy
Writing this policy takes an afternoon and you should do it before you need it, because the version you write under pressure will be worse and you will be stuck with it as precedent.
Put it in your employee handbook alongside the rest of your time-off rules, so that someone in the worst week of their life can find the answer without having to ask a question they would rather not ask. That is not a small thing.
Handling the Conversation Well
The policy is the easy part. The conversation is the part people get wrong, and at a small business you are usually the person having it, without training and without an HR department to hand it to.
A few things that help. Lead with the human part, not the logistics: acknowledge the loss before you mention days. Then be specific, because vagueness is not kindness. Tell them the exact number of days, tell them the days are paid, and tell them proactively that they can add PTO if they need more. Do not make them ask for anything they are entitled to, and do not put a form between them and the door.
Afterwards, resist the impulse to pretend nothing happened. The first day back is hard, and a brief private word about workload, without making it a performance conversation, is worth more than most managers realize. Grief does not resolve in five days, and the employer who quietly makes room for that in week three is the one people remember. Handled well, this is one of the few moments where a small business genuinely has an advantage over a large one, because you actually know the person.
Frequently Asked Questions
What is bereavement pay?
Bereavement pay is wages an employer pays an employee for time taken off after the death of a family member. It is a voluntary benefit in the United States: no federal law and no state law requires an employer to pay for bereavement time. A small number of states do require employers to provide bereavement leave, meaning protected time away from work, but that mandated leave is generally unpaid. Bereavement pay exists only because an employer chose to offer it. Most employers do offer some, typically three to five paid days for the death of an immediate family member.
Is bereavement pay required by law?
No. There is no federal law requiring bereavement pay or bereavement leave for private employers. The Fair Labor Standards Act does not require payment for time not worked, and the Family and Medical Leave Act does not cover bereavement itself, only a serious health condition. A handful of states, including California, Illinois, Oregon, Maryland, Vermont, and Washington, do require employers to provide bereavement leave, but with limited exceptions that leave is unpaid. Whether the employee gets paid is your decision, set by your policy.
How many days of bereavement pay is standard?
Three to five paid days for the death of an immediate family member is the common range, with one to two days for extended family. Survey data from HR industry groups consistently puts the average around three to five days for a spouse, child, or parent, and fewer for grandparents, in-laws, and more distant relatives. Some employers offer considerably more. The number is entirely your choice, subject to any state law that requires a minimum amount of leave, such as California's five-day requirement.
Is bereavement pay taxable?
Yes. Bereavement pay is ordinary wages and is fully taxable. It is subject to federal income tax withholding, Social Security and Medicare taxes, and federal and state unemployment tax, and it is reported in the employee's W-2 wages like any other pay. There is no special tax treatment for bereavement pay, which surprises some employers who expect it to be handled differently. It is coded and processed as regular wages. Note that this is separate from payments made to a deceased employee's estate, which follow different rules.
Do you have to pay employees for bereavement leave in California?
Not necessarily. California's AB 1949 requires employers with five or more employees to provide up to five days of bereavement leave for the death of a family member, for employees who have worked at least 30 days. But the law does not require that leave to be paid. If you have no bereavement pay policy, the five days may be unpaid, though the employee may choose to use accrued vacation, sick leave, or PTO to cover them. If your existing policy provides paid days, you must honor that policy for those days.
Who counts as family for bereavement leave?
That depends on your policy and on your state. Most employer policies cover immediate family, meaning spouse, child, and parent, and many extend to siblings, grandparents, grandchildren, and in-laws. State laws define family for their own purposes, and some definitions are broad: California's includes spouse, child, parent, sibling, grandparent, grandchild, domestic partner, and parent-in-law. Modern policies increasingly include domestic partners and chosen family. Whatever you decide, define it explicitly in writing, because the alternative is deciding it in the moment for a grieving person.
Does FMLA cover bereavement?
No, not the bereavement itself. The Family and Medical Leave Act covers an employee's own serious health condition, caring for a family member with a serious health condition, childbirth and bonding, and certain military-related situations. The death of a family member is not on that list. However, if grief develops into a diagnosable serious health condition, such as depression requiring treatment, FMLA leave may apply on that basis. FMLA also applies only to employers with 50 or more employees, so it is not available to most small businesses at all.
Can employees use PTO for bereavement?
Yes, and many do, either instead of a bereavement policy or to extend beyond one. Employees commonly use accrued vacation or sick leave to cover unpaid bereavement days or to take more time than the policy provides. Some state laws explicitly allow employees to substitute accrued paid leave for otherwise-unpaid statutory bereavement leave. Making this clear in your policy is worth doing, since an employee dealing with a death should not have to work out the mechanics of your leave interactions on their own.
Should a small business offer bereavement pay?
Yes, and it is one of the cheapest benefits you can offer. Three to five paid days for the death of an immediate family member is a rare event per employee, which makes the annual cost across a small team very small, while the effect on the person receiving it is disproportionately large. It is also a benefit that costs nothing at all in most years and everything in the moment it is needed. For a business without an HR department, the practical requirement is simply to decide the policy in advance and write it down.