I was recently layed off from my employer...today actually, I am wondering what about my vacation time. I have two weeks vacation and actually put in for a week during the holidays does the comapany have to pay me for the vacation time or what?

They owe you accrued vacation time only if their employee handbook says so.

What does it need to state that they pay in the event of a lay off.

Unless there is a company policy which states that they will pay out your vacation when you leave the company, they do not have to pay it.

The law does not require them to pay your vacation in the event of a layoff, a firing, a resignation, or any other time. The law only requires that they follow the policy.