Implementing PTO

My company is thinking of implementing PTO. Please share with me any tips, problems or procedures that you used in the implementation of this. Did your employees initial disprove of it?

Any information would be appreciated.

Comments

  • 6 Comments sorted by Votes Date Added
  • Welcome to the forum!

    I am curious about this as well, so I am going to respond just so I can see what others post.
  • I have done this with three different employers. In all cases, the employees reaction were mixed. In all of my cases, employees had previously accrued both sick and vacation hours. The employees who did not abuse sick time were delighted as they suddently had more paid time off to use as vacation. The employees who did over-use (read abuse -- no, not everyone who used a lot of sick time were abusers, but most were) were not happy as they suddenly perceived PTO as their vacation pay and they no longer had sick pay. Those who did recognize it as a combination of vacation and sick time weren't happy because their total number of hours of earned time off were less. (Example, if someone accrued 10 days of vacation and 5 days of sick time per year, they then earned 12 days of PTO per year.)

    Another stumbling point were the employees who did not use/abuse their sick time ... were they to be "rewarded" for their responsible use of sick time by suddenly revoking their 6 weeks (or whatever) of accrued sick time, leaving them with nothing? We managed that by creating an "extended sick leave" bank. Any sick hours available in employee accounts as of the date of transition to PTO was held there. Employees could only use time from this account when they were absent for three consecutive days or more due to their own, or their immediate family member's, serious health condition...essentially went hand-in-hand with FMLA absences. If an employee terminated having never used time from this bank, there was no payout for it, as they didn't get paid out their sick time either. But, as long as the person was an employee, and there were hours available, the time was held in reserve should they ever need it. (Hopefully my explanation makes sense.) Most employees left the company without ever dipping into those extended sick leave hours, and it demonstrated good will and fair dealing on the employer's part, especially to the employees who had been careful not to abuse their sick time.

    One employer that I worked with had hoped that changing to PTO would cut down, or eliminate, short notice sick absences as people could plan for time away without specifically stating vacation, medical appt, whatever. That hope was never fully realized.

    In all 3 of my situations, there was a period of probably 3-6 months (including time before, during, and after the transition to PTO) that some of the more vocal employees were very apprehensive and verbally unhappy about the change. In all of the situations, however, employees settled in to it and became a non-issue after a few months. And again, many employees were thrilled.
  • Sandra:

    Thank you for your quick reply! One question, why in the conversation of sick and vacation time did the employees 10 vacation and 5 sick days equate to 12 PTO days? What calculation was used and why?

    Thanks again in advance,
    Lbrenner, MA
  • We implemented PTO several years ago. What we did about accrued sick leave was to convert it to a monetary value as of 12/31/2001 at their current rate of pay. This was then frozen and put into a bank. This will be kept there until they retire/terminate. As of 01/01/2002, everyone started out with their accrued vacation (we didn't change that), and also their new number of PTO hours or days. We cannot accrue more than 200 hours of PTO. At that point, we do not accrue more until it has been used down. At the end of the year we are paid for any hours in excess of 160, then carry over 160. As for the "banked" leave, it can only be used if all available PTO has been used, and then only for employee illness or physical condition. It has worked out well, since many employees "burned" sick days and saved vacation days. Now it's theirs to use or get paid for if they don't.
  • Our company did this a couple of years ago...

    While we had separate personal and vacation categories, we were not very strict about requiring them to use personal time for ONLY sick-time use. Therefore, they used the two interchangably--essentially, using it as a PTO system.

    When we converted to a combined PTO, there was some mixed reaction until they understood how it would be done--then there weren't really any issues.

    The transition was a bit complicated. We didn't want them to lose any of their previously accrued time, of course. So, at the start, employees had the option of cashing out some of their accrued time up to 80 hours. Any remaining time would be rolled over to the new PTO plan (except for personal hours, which didn't roll over). We now offer that same cash out option at the end of each calendar year. We also have a maximum accrual of 320 hours--we've never had anyone reach the maximum and start losing time--I keep a watchful eye on it and give supervisors a heads up if anyone gets near that point.

    If you'd like the implementation notes I put together, let me know your e-mail address and I can send those to you.
  • Over the years, PTO was probably the most requested benefit from Staff. Prior to implementing PTO (we call it "Personal Paid Leave", or PPL), we had no paid sick leave. We have a mixture of hourly and salaried people, and being sick really affected hourly people financially. Not having any such benefit was affective morale negatively.

    I conducted a Staff Benefit survey last summer, and PTO was the number one requested benefit. PPL was implemented in about 2-3 weeks after the survey.

    I realize that this may be much less than what others are doing, but this benefit has been very well received. We announced it in multiple face-to-face meetings with Staff, and everytime it was met with applause.

    We did not want to format it or call it "sick pay", to encourage people to be sick, nor did we want to "punish" people who are always at work, so our "PPL" can be used for anything, including being sick.

    The Staff receives about 3 days of PPL per year, accruing at .93 hours per paycheck. The Staff member can accumulate to up to 160 hours of PPL, and canot "cash in" PPL. They can only take the time off. The people who get sick, use it, the people who don't, appreciate the extra time off.

    This was our experience.





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