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Does any have a spreadsheet they use to keep tract of vacation, sick, holidaysetc under a PTO plan? Do I need to track each separately?

Good for people to know.

We want to convert to PTO (and convert from a hire day accrual system to a calendar year accrual system) but we don't know how to do that without significantly increasing our cost two ways: 1) Currently we don't have any cost for unused sick days; with PTO we are ensuring that employees will take off those days, and 2) how do we convert each employee's current balance to the new accrual system? We've tried and tried and just don't see any formula that isn't both expensive and full of potential pitfalls. Can anyone help or share their conversion methodology? THANK YOU!

Does anyone have any suggestions on the most seamless way to do this conversion?

I worked at a company that offered a PTO bank and it worked very well. We accrued the PTO on a bi-weekly basis, so the employee could not use PTO that had not been earned. This method works well for management as the employee could not take all the time off at once-it was earned throughout the year. The paychecks showed the total amount of PTO available, which kept the employee "in the know". The PTO works out well for those who are rarely ill, as they will have more vacation time to use. I believe having the PTO bank doesn't force people to come in to work sick, as they know they will be paid for the time off and it will be excused. It is up to the employee to manage their time off well, and if this communicated to the employees at orientation, then there should be no surprise. To help deter abuse, vacation time should need advanced notice and approval, and for those who miss three or more days of work due to illness, then require a doctor's note to be produced upon returning to work.

We switched to PTO 3 years ago and it is working fine. PTO is given to everyone on the first day of each year removing the "accural" aspect and eliminating "having" to pay remaining PTO upon termination. If your handbook states that any unused vacation, sick, PTO, etc. will be forfeited upon resignation without, example; a 2 week notice then you don't have to pay it. Additionally, when we called it "vacation" or "sick" there were still those employees who would use it all long before the end of the year.

I've seen PTO work wonderfully and have seen it not so successful. In most instances, key drivers are effective communication and delivery. Failure has come when these two areas aren't addressed correctly.

My experience is that heathy employees really love it. Managers somtimes resent it because they have the mistaken belief that employees can call in with no advance notice and take a PTO day off. This is not true if you set up and manage your program correctly. There is potentially a higher cost to this as compared to traditional vacation/sick leave programs, for states like Illinois, and I believe most states are similar, where an employer must pay a terminating employee for all unused vacation but not unused sick leave. The total unused PTO balance must be paid to exiting employees.

We implemented a PTO bank a few years ago. We did not convert Sick days one for one for a PTO day - because we did not have a use them or lose them plan. We set a maximum number of sick hours that would go to the bank and any hours you had left in your "bank" would then go toward calculating Pension. The thing to remember when communicating is that this is not "vacation" time and not to let employee's confuse the two. This is a bank of leave that can be used by the employee for vacation leave, sick leave for yourself or family, etc. We have not seen an increase in employees coming to work ill so as not to use their PTO time - at least not anymore employees that used to do the same so they wouldn't exhaust their sick leave balances.

Currently our company has specific amount of Paid VA Days and Paid Sick Days. However, my thinking is about 10 years ago I personally felt that what worked really well for the employer and employee is to have maybe 7 to 8 VA days, and so many Sick Days, but make sure you also have a few Floating Holidays so an employee is not bound to say Good Friday if they do not celebrate that holiday.

Another way to approach this if an employee at the end of the year does not use their Sick Days, you could convert them to either VA or Floating Holidays and that way it is a win, win situation for everyone and employees are definitely out less. Also, look at what you can do as a company from a Wellness Program so employees are out sick less.

Last you could do a brief poll from Business 21 and get an overall response in general from a % perspective. Just a thought.

Thank you ~ Lori Hothan
HR Manager

In some jurisdictions, like Louisiana, state law requires that, upon separation of employment, an employer pay an employee any earned vacation. Earned sick leave, however, usually does not have to be paid to an employee who has separated from employment. Since PTO is a combination of sick and vacation, and since vacation MUST be paid to employees who have separated, arguably, employers will have to pay employees who are separating from employment the balance of PTO. Since sick leave cannot be separated out from PTO (and since vacation MUST be paid), the employer may have a greater financial liability by switching to a PTO system than having a separate vacation and sick leave system.

I personally like PTOs because it allows the employee to be responsible for his/her own time in addition to taking longer time off with family. The biggest con is that employees run out of time by the end of the year and cannot take additional time off around the holidays.

We used to give 4 hrs vacation and 4 hrs sick leave each pap period (13 days per year) and some people used sick leave as fast as they got it. We changed our policy to 13 days vacation, 5 days PTO and 7 days sick leave annually - accrued hourly each pay period . The sick leave can't be used until the fourth day with a doctors excuse. The PTO can be used for those days when you have a cold or flu and aren't sick enough to go to the doctor or can be used for sick kids or whatever you want. The abuse of sick leave stopped.


Here is a great link that SHRM had on their website last September. When employees "own" their time off, they tend to be a little more prudent about using it. You will always have abusers no matter what system you have in place, but PTO gives employees a sense of ownership. This system isn't perfect but it's a lot more easily administered than the conventional sick, personal, and vacation method.

I am a consultant and in most cases my clients have converted to PTO banks--most employees seem to like them better and it does seem to eliminate false sick days and is easier to administer.

We moved to PTO days a few years back. Our employees love it. They truly feel they can manage their time off and use it as they need to use it. You will always have a handful of employees that will use their PTO as quickly as they earn it. However, we find we have a number of employees we have to force to take time off so they don't max out.

This also allows individuals that celebrate holidays that are not the established holidays to use their time to observe those days. It has been a very positive experience. We do have managers that periodically allow employees to take time off without pay even when they have time in their banks so we have to carefully watch for that.

We also use a PTO donation program where employees can donate PTO time to coworkers that have catastrophic events or emergency medical conditions and do not have the PTO time to cover the time they need. All in all PTO has been a great move for us.

We are set up to give our employees who are eligible 6 days to be used for sick time at the beginning of the year. Their vacation is accrued on a per-payroll basis. At the end of the year, any unused sick time is put in a Medical Leave Bank to be used for approved medical leave of absence to cover the waiting period before short-term disability is available. This is for the employee's use only - not to be used for family members. We find this works well in lieu of PTO time.

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