PTO (Paid time off) programs and policies have the capacity differ drastically from one company to another, taking on a personality as individualized as the organization instilling them. The most common uses of paid time off are personal time, sick time, vacation time, and paid holidays.
The general intention of sick time is to be used when an employee is too sick to do their job, thus needing to stay home and take time off to recover. Sick time is generally unplanned. Vacation time is generally planned ahead of time and allows an employee to take time off of work as a break. Generally personal time falls somewhere between sick and vacation time. It may be planned or unplanned and used for things from doctors appointments to mental health days to family emergencies.
Common PTO Policies
Some companies will categorize PTO into banks by the various types and then allow for a certain amount to be used from each bank (example: 5 sick days, 10 vacation days, 4 personal days, 1 floating holiday and 8 specifically assigned holidays.) Other companies others may choose to alot for one all-encompassing PTO bank system that may include all of the subtypes (example: 19 days of PTO to be used as needed for vacation, sickness, and personal reasons, 1 floating holiday and 8 specifically assigned holidays.)
Many organizations have begun using the all-encompassing system as it encourages their employees to use their PTO more honestly and in some cases more sparingly. When an employee is allotted a certain amount of time, uncategorized, they may be more likely not to call in sick when they are actually well, in order to save that time for a desired vacation. These types of programs also tend to eliminate any discrepancies between employees and employers about what qualifies as sickness, personal time or something else.
A new trend that seems to be on the rize is the allocation of Unlimited PTO. In many work environments it has been found that an employees are actually more productive when they are not confined to a standard eight hours of work a day, 40 hours of work a week. They may be better suited to work 4 hours one day, 10 the next, or 25 hours one week and 50 the next. Because of this, more and more employers are taking the approach that as long a work is being completed and completed well, they don’t care when time is taken and they don’t care what it is taken for. This enables employees to move around their hours to suit their productivity as well as empowers them to control their own work environment. Many employers who have adopted this approach have seen higher productivity levels and happier employees.
On the opposite side, it is often argued that unlimited PTO often results in employees using less PTO than if they were afforded a traditional PTO plan. There is a greater expectation of work getting done that may then cut in to actual vacation time taken, or detract from the vacation time taken all together.
It is also becoming more common that when hiring new employees, employers will actually require them to take a paid vacation (generally two weeks) prior to starting their new role. This is called a “pre-cation.” Not only does this practices help attract new talent, giving this time allows and employee to take time between their former job position and their new role to refresh and reenergize. Employers who’ve adopted this practice want their new employees to take the time for themselves so they are better able to come in ready to hit the ground running, not feeling tired and worn from their previous job.
There are arguments both for and against the pre-cation. While it is a nice thing to have before starting into a new role, it has also been argued that it is an indicator of an overworked work force. In addition to that, there are people who believe that giving an employee something like this on the front end may then imply that the employee owes the employer something once they start their job, setting them up to continue to be overworked and overstressed, even maybe more so than they were going into the whole situation.
Come back next week as I discuss how PTO is calculated and discuss unused paid time off in the case of a termination or someone quitting.