What is Paid Time Off (PTO)? Explained with 10 PTO Examples

Paid time off (PTO) is one of our favourite topics here at PurelyHR. Let’s get back-to-the-basics with this one.

There are all sorts of reasons you might need time away from work. That’s where PTO comes in. Life is full of all kinds of surprises. An unexpected illness, early labour, last-minute plans…a pandemic. Then, there are those moments you plan for (vacation!). 

Leading employers recognize the importance of paid time off. Time away from work leads to happier, healthier, more creative employees. The beauty of providing paid time-off is you can provide employees with support and the sense of stability. This encourages good productivity and a thriving workplace.

What is PTO (Paid Time Off)?

PTO stands for Paid time off and it is a company policy or benefit program that allows employees to take time away from work for illness, vacation or for personal reasons, and still receive compensation.

How much time off is given depends on the company. The other thing to consider is that depending on the location of your business, you may be subject to different laws. For example, in some places, you may be required by the government to give paid time-off for Jury Duty or Military Duty. Other laws only require you to provide the time-off with or without pay.

In recent years more and more companies have blurred the lines between traditional sick leave, vacation and “personal” days. This recognizes the varied needs of employees. In these cases, you may wish to allocate a bank of time for any of these PTO types.  For example, instead of 10 sick, 10 vacation, and 5 personal days, you would simply have 25 paid days off. 

Exploring 10 Examples of Paid Time Off (PTO)

Types of PTO vary depending on company and location. Here are 10 common (and a few less common) types.

While federal and state/provincial laws may set minimum requirements and expectations to employers for a job-protected leave of absence, there are many opportunities for you to set your own policy to turn a leave of absence into paid time off or increase the benefit beyond the legal minimum. 

Vacation 

Vacation pay may or may not be required by law, but can often be a deciding factor when recruiting potential employees. This often increases as years of service increase. Employees may opt to pay vacation pay annually or to pay a portion with every paycheck. 

Parental Leave

Maternity Leave: 

Parental leave is national statutory paid leave in Canada. In the US there is the guarantee of 12 weeks of unpaid maternity leave under the Family and Medical Leave Act. 

Paternity Leave: 

Parental or paternity leave is not mandatory in the United States, except under the Family and Medical Leave Act (FMLA), which allows eligible employees to take up to 12 weeks of unpaid leave. Although some states and companies may provide paid paternity leave, it is not common. Canada offers more generous paternity benefits, allowing eligible fathers to take up to 8 weeks of parental leave. The duration of this leave can be extended based on how it is shared between partners.

Sick Leave

This type is less fun. Time away due to illness or injury or to seek medical care. This type of paid time off can sometimes segue into long- or short-term disability. Expectations for how much sick leave you’re entitled to depends on employers and/or your state/province.

Bereavement/Sympathy Leave 

The length of paid time off for bereavement may have a minimum requirement by law. It is up to the employer to determine if they wish to offer benefits for longer. This benefit and the amount of time is often based on the closeness of the relationship between the employee and the deceased. For example, a spouse vs cousin vs grandparent. 

While it often only includes the direct family line, this can be an opportunity for employers to show their employees support by extending the guidelines. This could include close friends or non-immediate family.

Holiday Pay

Many companies follow only the statutory government holidays, however as the diversity of our culture grows, allowing employees to use PTO for non-government holidays can help encourage an inclusive environment in the workplace. These are often referred to as “floating holidays.” 

Survivor’s Leave

A difficult, yet vital, type of time-off. The province of Ontario, for example, has Domestic or Sexual Violence Leave. This allows for 10 days up to 15 weeks of time off, however, only the first 5 days are paid.

In the US, while there are no federal laws, there are municipal and state laws that protect victims of domestic violence. These laws may vary from providing a safe workplace to providing paid time off. 

Diverse Forms of Paid Time Off PTO Beyond the Norm

Those are some of the “typical” types of paid time off. Now, let’s take a look at other, less common types of paid time off in the workplace. 

Pet Bereavement Leave

A less traditional type of bereavement leave. Some employers also offer pet bereavement leave for employees who experience the loss of a furry family member.

Civic Duty Paid Time-Off

There are many civic duties that employers are legally required to provide time-off to their employees. These include Jury Duty, Voting, Military Service etc. These guidelines vary from state/province.

In Ontario, employees are entitled to three consecutive hours of time off during the polling hours. You may or may not need to adjust your employees’ schedules to accommodate this. Employers must pay employees for time off if they need to leave work to vote. This may or may not be the government requirement for your business. 

Adverse Weather

When adverse weather causes a closure of your business, you may elect to pay employees for the day. The increase in working-from-home may have eliminated this temporarily but there are still plenty of workplaces that depend on employees being able to commute to work.

Professional Growth/Self-Care

Employees may be more willing to attend conventions or industry events outside of their typical work week with the availability of paid time-off for professional growth. This could come in the form of something like conference and convention leave.

You may also choose to pay employees for the hours spent taking classes, or doing online training which improves their professional skills. 

Finally, as the importance of mental health becomes a mainstream topic in the workplace, a mental health or self-care day is a good way to recognize the importance of this area of employee health.

Yay Day

This is one of our favourite PTO types at PurelyHR. Every year we get a day off to try an activity that’s new to us or to do something we enjoy. This is a great way to show some employee appreciation.

Two final types of PTO worth mentioning: volunteer time and shared-leave.

To encourage altruism and support your community, you may opt to give employees paid time off to volunteer at events like food drives or participate in a charitable event. Volunteering as a team for an organization that supports your business mission is also a great way to team-build and give back.

Another innovation in paid time-off is the shared leave policy. This allows employees to transfer or give their paid time-off to co-workers who are in need. 

How Do I Track Paid Time Off? 

With so much to consider when it comes to PTO, how do you track employees’ time-off? You can do it manually, using spreadsheets or other paper forms or you can use software. 

PTO tracking software allows employees to submit requests for time off and allows you, the HR department, or managers to manage requests. This allows for a centralized process, which is time- and cost-saving. Tracking programs allow your employees to view their leave policies and ensure that requests follow the correct workflow. 

PurelyHR’s Time-Off module allows you to track both paid and unpaid leave, as well as automate accruals, renewals, policy changes, and more. You can also create as many time-off types as you like based on your company’s paid and unpaid leave types.

Whether it’s vacation, sick leave or employee appreciation-style PTO, find out how we can help you stay on top of your time-off management. Book a demo today!