Pay & Salary

What Is PTO? Definition, Types and Tips

March 30, 2021

Oh, those precious days away from work. Days to renew, refresh, reset, and restore. You certainly have earned them. Time away from work can help you feel refreshed and may even make you more motivated to pursue your work-related goals.

However, you may not know all aspects of your benefits such as paid time off (PTO). Your previous positions may have not had PTO days, but instead perhaps set sick days, personal days and/or vacation days. Because PTO is an important consideration when deciding whether to accept a role, you should take time to fully understand the types of PTO offered and whether it changes with tenure. In this article, we explain what PTO is, the different types of PTO and how you can plan for stress-free time away from work.

Related: 6 Tips for Your Next Salary Negotiation

What is PTO?

Paid time off (PTO) refers to the time that you are paid for when you are not working. PTO includes paid vacation, sick time, holidays and personal time all wrapped up into one category that allows you the freedom of using your time as you please. Other companies treat vacation, holidays, sick time and personal days separately.

More and more businesses today offer “unlimited” PTO in which you do not have to accrue time before you can take paid leave from work. However, there are often stipulations such as being with the company for a certain amount of time.

Related: Base Salary and Your Benefits Package

Types of PTO

There are several kinds of PTO that companies generally offer. This is a great thing to inquire about when you are negotiating your benefits package. It is also a good idea to ask whether the number of days you are allotted changes with the longer you are with the company. Companies often award more PTO days the longer you work there as a way to encourage employee loyalty. Here are some types of PTO that you may be offered:

Set number of days

If you are awarded a set number of days, this means you may be offered a set number of days per year. It’s common for new employees to not eligible for any time off when first hired as you may be placed on a probationary period. For example, your employer may allow for 10 days of PTO per year, however will not let you take any PTO for the first 90 days.

Employers may give you your full benefits right away or after the probationary period, while others may require you to accrue time with each pay period.

Accrued time off

Accrued time off allows you to accumulate a certain amount of time for each pay period. To calculate the amount of PTO you receive each pay period, multiply the number of days by the time you would work on those days.

For example, if you receive 15 days off per year and you work eight-hour days, you will earn 120 hours per year. Divide those hours by 52 — the number of weeks in the year — to calculate the number of hours of PTO time you will accumulate per week.

Rollover allowances

You may be offered the option of rolling over your PTO from one year to the next. For example, if you only used 10 of your 15 days of PTO this year, five days would roll over to the following year. However, you may have limits on this where companies only allow you to accrue so much PTO time before you start to lose hours.

You may encounter a “use it or lose it” policy that encourages you to use your PTO time in full each year or lose it entirely.

Related: How To Negotiate Salary (With Tips and Examples)

How to plan for PTO

When you take time off from work, you may have lower stress, a better outlook on life and be more motivated to achieve your personal and professional goals. The key is to plan for your PTO time. Follow these steps to help accomplish that:

1. Plan in advance

Find time in your calendar and block the days off well in advance to avoid meeting invites. This will also allow you to plan backward from that date and identify any key deliverables that you might have during that time.

When you book the dates in advance, it gives you ample opportunity to get your work done—or at least the important work that only you can do—well in advance. It will also give others time to prepare for your absence, possibly reassigning work for identifying higher priority tasks.

Make sure co-workers who are handling your work while you’re out are aware of their responsibilities ahead of time. Take time to meet with them so that they fully understand how to complete those responsibilities successfully.

2. Identify a “go-to” person

It is smart to identify a person who people can go to when you are out of the office. That person can be an assistant, a co-worker or your manager. Set an out-of-office auto-reply in your email so it is easy for people to identify who to go to while you are out.

Read more: Guide: Out-of-Office Email Messages (With Examples)

3. Plan meetings appropriately

It would be wise to leave your agenda open and avoid setting meetings during the week before your scheduled time off. Doing this would allow you to have time to finalize projects or to finish up anything needed before your PTO.

You may also choose to meet with co-workers so that they are aware of any shifts of responsibility during your absence or to hand off projects. Regardless of your approach, it will put both you and your co-workers’ minds at ease knowing everything is in order before your departure.

So go ahead and schedule some PTO days. Just make sure that you follow your company guidelines and be professional when working with your colleagues. You do not want to have to worry that you may have to log or check-in while you are refreshing your mindset.

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