Is Your Time Off/PTO Policy Working For You?
Posted by Nancy Saperstone on Thu, Oct 08, 2009 @ 12:31 PM
Now is the time of year that employees begin to look at their vacation and PTO balances and realize that they have three weeks of vacation to take before the end of the year, or they'll loose it. Do you allow them to take it all in one block? Do you require them to break it up into shorter amounts (i.e. a week at a time) or do you make an exception and allow them to carry time over? On the flip side, maybe you have an employee that already has a planned vacation but has already taken too much time this year and has no additional time to take...
Time Off is one of those HR policies and employee benefits that is very close to an employee's heart and therefore issues around time off can often be contentious between the employer and employee. Whether you have a vacation or PTO policy, having a well-defined and market competitive time off policy can help promote employee retention and employee motivation. Your employee handbook should outline the policy and all the specifics around taking time, balances and the logistics. When writing your policy consider the following:
- Eligibility - When are new hire eligible to begin taking time?
- Pro-rated time - What is the threshold for part-time employees to take time and how is it pro-rated?
- Accrual amounts - How does time accrue? Does it increase based on length of service, position or some other measure?
- Approval process - What is the process for requesting time off? Who keeps track of this?
- Taking time - Are there requirements around how much time an employee can take in a row? Do you limit employees to only a week at a time, or maybe 2?
- Use it or lose it - What happens to unused time at the end of the year?
- Carryover - How much time can an employee carryover at the end of the year? Are they required to take this carried over time during the first 3 or 6 months of the year?
- Payout - Do you have a policy to payout employees for unused time?
- Negative balances - What will you do if an employee wants to take time they have not yet accrued?
- Termination - Keep in mind that any unused accrued time must be paid out to the employee upon termination. You'll want to write your policy in a way that will not result in excessively high balances that require payout upon termination.
Once you've written and published your policy, the most important thing you can do is, STICK TO IT! An employee policy that is constantly having exceptions made is not an effective policy and only breeds dissatisfaction among the employee and employer!