Paid Time Off (PTO) is a scorching topic around the workplace water cooler. Your PTO policy is one of the first things potential candidates and new hires ask about, and current employees want to understand it better.
PTO can also be a big headache for employers. Employers want to know if giving PTO or vacation to employees a big waste of time, money and resources? Is PTO really going to add value to my company?
Offering paid time off isn’t a waste of anything, and if done correctly, it does add value to your company. Everyone needs to get away once in a while because burnout happens to anyone. Burnout is associated with decreased engagement, employee job dissatisfaction, lackluster
creativity, stagnant efficiency and so much more. Also, you run the risk of increased negativity and bad attitudes, along with risks with workplace safety. Burnout isn’t good for employees or their employers.
The most asked question about paid leave that our outsourced human resource experts receive is about how to address the needs of your employees, and simultaneously mind the needs of the business? To answer that, first let’s look at common employer concerns:
- Determining the right amount of PTO to offer
- Using Paid Time Off vs. vacation and sick days
- When or if it increases over time with tenure
- How it is provided and when
- Scheduling and business coverage
- Specifying the usage increments
- PTO program cost
- Eligibility and salary vs. hourly
- Allowing employees to carry a negative balance
- Allowing employees to carryover balances to the next year
- Paying out or not when employees leave
hr-haven’s recommendations for PTO
A clean
set of PTO policies – as shown in this link from the US office of personnel management – can make your company more attractive to prospective employees, not to mention it can be a great retention tool as well. Since most employees are healthy and don’t always use all of their sick leave, this is a great way to let them take the difference in extra vacation or personal time.
Our HR experts prefer and recommend a Paid Time Off (PTO) policy that can be used for rest and relaxation, a mental health day, if the employee is sick (or someone they love is), doctor visits, holidays that are not recognized by the company, and any other personal business.
PTO is easier to track, with just one bank of time to manage and no need to differentiate between sick time and vacation or personal time.
How to Best Manage a PTO Policy
Make sure your PTO policy covers how and when to request time off and the details relating to approval. Even with the best intentions, employees have a tendency to come to work sick in an effort to save their PTO, which puts other employees at risk for becoming ill. It may be hard for them to understand at first, but make sure that sick employees sent home understand it’s to protect the rest of the staff from getting sick.
If you have concerns with unscheduled or unplanned time off, you may want to make a distinction between scheduled and unscheduled time, and what is acceptable. Clearly communicate those expectations with your staff to avoid confusion and frustration.
Will you allow employees to carry over unused PTO? If not, use it or lose it isn’t always legal with all employees. You also want to address what happens to PTO when an employee leaves the company. There are specific laws relating to payment or non-payment of PTO, so be sure to do your research or consult with your outsourced hr firm.
There are a lot of things to consider when crafting a paid time off policy and so many ways to handle employee leave programs, that it really is best to consult a human resource professional. There are federal and state guidelines to be aware of and you want your PTO to be mutually beneficial for both you and your employees.
When your paid leave policy is wisely implemented, communicated company wide and managed correctly, you will have much happier and engaged employees. We help companies like yours with these decisions every day, as well as many other important HR functions like creating a winning culture and providing sexual harassment policies. Call us today to learn more!