What is VTO?

VTO is an HR acronym that can stand for either Voluntary Time Off or Volunteer Time Off. As an employer, you need to understand the difference between these two types of policies and educate your employees about their access to leave under them.

Voluntary time off

Voluntary time off is a category of leave that gives your employees the option to take unpaid time off work at their discretion. This VTO policy can be used to balance your staffing requirements with your workload, ensuring you don’t have too many employees on site with an insufficient amount of work to complete on any given day.

With a voluntary time off policy, employees are better able to balance the demands of their personal lives (family, childcare, etc.) without losing employment or jeopardizing their position with the company. VTO has no effect on an employee’s PTO or paid time off, so it doesn’t cause them to lose out on their vacation days or available paid sick days.

Volunteer time off

VTO meaning in the context of volunteer time off is a completely different policy from voluntary time off. In a volunteer time off policy, employees receive their pay for regular hours worked while spending those hours assisting a registered charity of their choice. Many companies are now offering volunteer time off as an incentive for employees to dedicate time to a cause close to their hearts and give back to local communities without compromising their paycheck.

Companies that are embracing this social responsibility include AppDynamics and the Federal Reserve Bank of Boston. Each of these companies has at least one day annually where employees get paid to spend their workday at a nonprofit organization.

The pros and cons of a VTO policy

Depending on which type of policy you’re referring to, both offer benefits for employers along with a couple of drawbacks to keep in mind.

Benefits of voluntary time off

When your workers can take time away from work at their discretion, the advantages for employers include:

• Increased employee satisfaction
• Reduced rates of turnover
• Higher rates of employee retention
• Improved workplace morale for better productivity
• Fewer unproductive hours employees spend at work

Disadvantages of voluntary time off

While a voluntary time off policy, when carefully implemented, can benefit your company, there are some potential drawbacks to consider.

• Inconsistency between workload and staffing
• Potential for decreased productivity if VTO interferes with scheduling

Benefits of volunteer time off

According to the MIT Sloan Management Review, the availability of volunteering opportunities can boost morale and even help employees develop skills commonly used in the workplace. A volunteer time off policy can also:

• Attract high-performing and socially responsible talent to your company
• Build your reputation as a socially responsible company
• Encourage employees’ personal development and growth
• Instill a sense of purpose and fulfillment in your staff

Disadvantages of volunteer time off

Overall, volunteer time off is a positive workplace policy. However, there are a few potential drawbacks for employers:

• Cost of paying employees for time spent somewhere other than the workplace
• Potential loss of productivity or scheduling conflicts when employees take time off for volunteering

Considerations for creating a VTO policy

To successfully create any kind of VTO policy within a company, your HR department needs to have a detailed plan and guidelines in place to ensure equity among your employees. For voluntary time off and volunteer time off policies, your organization must have clear answers to these questions:

• Who is responsible for approving time off requests?
• How much advance notice should an employee give when requesting time off?
• What is the process for employees submitting their time off requests?

To make VTO accessible, employees should have a clear idea of how they can get their time off request approved efficiently so they are able to use this time to their advantage.

There are also more specific questions to look at for each type of VTO policy.

Considerations for a voluntary time off policy

When creating a voluntary time off policy for your employees, define the parameters of the arrangement so staff members aren’t hesitant to submit their requests. Consider the following:

• How many days of unpaid time off per calendar year can employees take without penalty?
• To whom do employees have to communicate their planned time off?

Considerations for a volunteer time off policy

With a volunteer time off policy, there are going to be significant amounts of documentation and paperwork (such as time off request forms) your HR department will need staff to complete in order to get paid for their volunteer time. You must think about:

• What proof do you require from the employee that they’re volunteering with a legitimate nonprofit or charitable organization?
• Are there off-limits volunteer opportunities that don’t align with your company values?
• How many days per calendar year can your company afford to pay employees their regular wages for time not spent completing work-related tasks?

Once you’ve assessed these questions, you and your HR representative can outline a clear policy for VTO that fits your company’s needs and supports employees’ development outside the workplace.