Figuring out your employee benefits can feel like tug of war when you begin to think about investing in employee health and evaluating the costs of retention. One of the most desired benefits an employee seeks is paid time off (PTO). Paid time off, also known as personal time off, is a number of hours that an employee can accrue and later draw upon to be paid while taking time off work.
Paid time off is a benefit and a privilege many employees value. Determining whether or not it's a benefit you should offer and the amount of PTO an employee can accrue can vary on a variety of factors.
On the federal level employers are not required to pay for time not worked, though some individual states have other laws. In a 2013 study by the Center for Economic and Policy Research found that nearly 1/4 of U.S. companies offer no time off. A remarkable 23% of American workers have no paid vacations and no paid holidays. The Fair Labor Act (FLSA) does not require payment for time not worked, making it something not all employers offer.
Despite no federal law in place that requires paid time off, the practice has become an expected benefit in the workplace and therefore most companies, especially those competing for talent, offer some amount of paid time off.
So, is paid time off something you should offer your employees?
Having a healthy work-life balance has never been more important, every employee will require time off for vacations, sickness, and to be with family, at one point or another. According to the Bureau of Labor Statistics (BLS), on average employees get 11 days of PTO per year.
It comes down to the culture you have established in your organization and whether or not taking time off is frowned upon or supported by both leadership and fellow employees.
Paid time off is crucial to an employees’ physical and mental health, at home and at work. Time off isn’t just to benefit your employees, it also benefits the company. A competitive PTO policy is a great way to attract top talent to your organization. It is also a great way to encourage employees to spend time away from the office to in turn create a healthier work environment.
Employers who offer their employees a suitable amount of PTO see less employee burnout and greater productivity, improved employee engagement, and higher retention rates than those who offer no form of paid time off.
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