Facts you should know about Paid Time Off (PTO)

To help you think about whether a PTO policy will work in your organization, here are the advantages and disadvantages of adopting PTO over traditional paid time off days.

Advantages of a Paid Time Off Policy

  • You treat employees as adults who are entitled to use PTO at their discretion without oversight. Managers are not put in the position of having to police their reporting employees’ use of their benefit, paid time off.
  • PTO gives the employer some control over unscheduled absences, a serious problem, and cost for many. Employees can schedule time off in advance which assists with work coverage.
  • Employees value the flexibility that PTO provides. It gives them the option of using the paid time off when they most need it—whether to care for a sick child who can’t go to daycare or to take a vacation with the family at the beach.
  • In the past, employees may have been untruthful about why they needed to take time off from work because they wanted their manager to think positively of them. PTO, in allowing them to make adult decisions, provides no reason for employees not to tell the truth.
  • Employers can address employee attendance only with people who are gaming the system or having attendance problems, rather than having to impose a lot of rules and guidelines for your average employee who attends work regularly with no problems.

Disadvantages of Paid Time Off Policies

  • Some research shows that employers who adopt PTO may give employees fewer overall days than they had previously, and/or new employees accumulate PTO more slowly than longer-term employees.
  • Employees tend to view PTO as a benefit and use all of the time off, whereas they may not have in the past. when they had time off for personal days, sick days, and vacation. Americans, especially, are notorious for not taking paid vacations and other paid time off of work.
  • Employees tend to view all PTO time as vacation time and come to work when they are sick. Employers can discourage this practice with absenteeism management practices. Managers in the organization need to set the pace and expectations and model appropriate behavior for employees. Coaching can also help address the issue of employees coming into work sick.

Paid Time Off Policy Averages

In a 2016 survey conducted by the Society for Human Resource Management (SHRM), “The majority of organizations offered PTO plans (87%) and paid vacation plans (91%) to employees based on their length of service at the organization. For PTO plans, the average leave days awarded per year based on employee’s length of service ranged from 13 to 26 days and eight to 22 days for paid vacation plans.”

If you are a member of SHRM, you can download the complete report from the above reference link.

In a study conducted by the WorldatWork Association in September 2014, the average number of PTO days offered by employers was:

  • Less than one year of service: 16 days
  • 1-2 years of service: 18 days
  • 3-4 years of service: 19 days
  • 5-6 years of service: 22 days
  • 7-8 years of service: 23 days
  • 9-10 years of service: 24 days
  • 11-15 years of service: 26 days
  • 16-19 years of service: 27 days
  • 20+ years of service: 28 days

You’ll want to take a look at the whole survey report about paid time off. In addition to the range of paid time off days that employers offer, the rest of the employee benefit, paid time off, is explored.

In several of the service periods of time, the number of days of paid time off dropped between their 2010 survey and the 2014 survey.