Pto

We are considering moving from having separate designations for vacation, sick and personal time off to providing one set of days designated as "PTO." If you have tried this, can you provide feedback on successes and problems you have encountered? Also if you could address:

Do you pay people for unused time off at the end year?
Do you allow any carry over into the next year? Limits?
If you are in N J (Or another state that requires that departing employees receive pay for any unused, accumulated vacation days, how you calculate this? )
many thanks,
Leslie

Comments

  • 5 Comments sorted by Votes Date Added
  • We went to PTO in 1998. At that time it included only sick and vacation, and based on how those leaves were used prior to the change, we only paid out 35% of PTO when employees left the company.

    A few years ago we changed it to include 2 float holidays. Our owner company also includes other holiday pay (like Thanksgiving and Memorial Day), but we felt that would confuse the issue so it is still separate (and paid as it comes up, not accrued). We now pay employees who leave us 100% of their bank, and offer employees the option of buying back PTO at 50% (limited to once per year.)

    In both cases, we allow employees to accrue up to 23 months worth of PTO. When they max then nothing is accrued again until they use some.

    We absolutely love it. The employees really love it too. It has reduced some of our 'policing' of sick leave. In fact, employees tend to be less inclined to just call in a sick day.

    The key to success is making sure your plan is well thought out and clearly and effectively communicated to the employees. I would also keep it very close to what they are used to. For instance, if you don't roll over to the next year now, then think twice about doing it with the change.

    I would also advise you to be open to feedback and be prepared to make some changes if what you are doing could work better.

    Good luck!

    Nae
  • Welcome to the forum!

    We utilize a PTO system, and we have some who love it and some who wish we still separated sick & vacation. Here's the highlights, I hope it helps:

    - Our employees accrue hours on a per pay period basis. For example, first year employees receive 15 days of vacation per year. That's 5.0 hrs they accrue each paycheck (we pay semi-monthly).
    - We also have a cap of hours that can be accrued each year. Once the employee accrues up to the cap, PTO does not accrue until they use their time off. We do this to avoid huge payouts in the event of termination, as we are in a state that also requires payment of all accrued but unused PTO.
    - Each anniversary year, employees can carry over their entire balance, up to the PTO cap for that year (see above).
    - To calculate PTO payout at termination, we just look at how much the employee has accrued through the pay period of the termination (our payroll service also does this for us).
    - Except for special situations, employees must accrue time off before they can use it. At the end of the year, employees can carry over their
    - We also grant employees 3 floating holidays that are treated differently than PTO - they are not paid out at termination because they aren't vacation time, they are part of our holiday schedule.
    - The biggest problem we have is employees not budgeting their time off for sickness. They often use all their PTO on vacation, then when they are sick, are forced to take the time unpaid.

    Good luck!
  • Our employees like it although some do not manage their time well and end up having to take days without pay for sickness. We discourage this and if it continues to happen we will put someone on probation for this. We allow accrual of PTO before it is fully accrued. Employees accrue per pay period. PTO must be taken in one (1) hour increments. It must be scheduled if at all possible. Upon resignation or termination, the employee is paid for accrued unused PTO. Also if PTO taken exceeds what the employee has accrued, we require the employee repay the Company for the excess. We take this out of the employees last pay check or if that does not cover the amount, we require they pay us by check or cash. We allow carry over of up to 80 hours of PTO to the next calendar year.
    PTO is separate from holidays.
    Accrual of PTO is based on years of service.
    Years 1 to 4 gets 160 hours and accrues 6.67 hours per pay period (rounded).
    Years 5 to 9 gets 200 hours and accrues 8.33 hours per pay period (rounded).
    Years 10 to 19 gets 240 hours and accrues 10 hours per pay period.
    Years 20 to retirement gets 280 hours and accrues 11.67 hours per pay period (rounded).
  • Your employees must be incredibly happy! That's a lot of PTO!
  • We did a survey of companies in the area. We took their vacation, sick time and any other time off they offered and we are very competitive. It does seem like a lot of time off but we really don't have more time off than other companies. It is so much easier with the PTO than divided up between vacation, sick time, etc.
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