What is PTO and How Does it Work? Tips & FAQs

Being an employee gives you opportunities to earn a living, pursue a career path, and be part of a good company culture. Alongside these possibilities is the need for more personal endeavors that a job cannot fulfill. One way to do this is to utilize PTO or paid time off.

PTO policies help companies provide paid time off for workers to boost employee morale, increase job satisfaction, and elevate employee well-being. In fact, a survey shows that 90% of employees see PTOs as a vital benefit in a company. As an employee, you need to know your PTO privileges.

So, what is PTO and how does it work? Read on as we discuss paid time off, its different types, tips for using PTO at work, and some frequently asked questions.

What does PTO mean at work?

PTO means paid time off at work. It is one of the employee benefits provided by companies, compensating employees during their absence from work. Employees use their paid leave when they are sick, on a vacation or holidays, or with personal appointments.

PTO usually allows employees a set amount of leave per category, while employees who have more years of service get to earn additional time off. For example, a new employee is granted 15 paid sick leaves when hired and earns more PTOs the following years.

How does paid time off work?

An organization's PTO policy can vary from one another. As an employee, it is important to know how your company structures its paid time off. Here are a few ways on how organization's implement their PTO plans:

• Traditional paid time
  Some companies have a definite number of days every year allotted for vacation time, sick leave, and personal days. For example, old employees are allowed 10 days of sick leave and 15 days of vacation leave throughout the year. Meanwhile, new hires are put in a 3-month probationary period before they can earn their PTO benefits.
• Accrued time off
  This company policy means workers can accumulate a certain amount of PTO every pay period. PTO hours are usual for hourly employees, earning PTOs based on how many hours they worked. For example, an employee gets one hour of PTO for every 20 hours worked. After working 600 hours, the employee earns 30 hours of accrued PTO.
• Unlimited PTO
  The unlimited PTO policy allows employees to take as much time off as they need, given that there is permission from their supervisor and their work has been completed beforehand.

What are the different types of PTO?

Just like PTO policies, employees receive different types of paid time off as part of their benefits package. Depending on the company you belong to, here are kinds of PTO you can earn when you're not on duty:

• Holidays
  Employees are not required to file for time-off request during standard national holidays when the entire company observes. Floating holidays, like Chinese New Year or Eid al-Fitr, also allow individual workers to take time off for cultural or religious observances.
• Vacation leave
  This gives employees the opportunity to travel, relax, and engage in personal leisure without having to think about less work compensation.
• Family leave
  An example of paid family leave is parental leave, where companies with family-oriented culture provide time off for employees to take care of and bond with their children and family members.
• Sick leave
  Paid sick days include suffering from injuries or illnesses that hinder an employee from reporting to work. This allows workers to focus on their recovery while being assured that they are not losing their wages from not being on duty.
• Personal days
  This leave caters to personal matters that individual employees go through, such as family obligations, appointments, errands, and mental health breaks.
• Bereavement leave
  Paid bereavement leave is offered to employees whose loved ones have passed away, allowing workers to grieve and organize other post-death arrangements. The eligibility and length of the paid time off depend on the worker's relationship with the deceased.
• Jury duty
  This is given when employees are summoned to court to serve as jurors, alleviating their financial stress while partaking in important legal processes.

Tips for using your paid time off (PTO)

For employees, paid time off is an opportunity to rest from work, run crucial errands, spend time with family, and maintain work-life balance. To ensure that you spend your PTOs effectively, unlimited or not, here are important tips for you:

1. Know the company's time off policy:
   To avoid unexpected violations against your employer's PTO guidelines, learn their details and specific rules first before making vacation plans. Also, be attentive to your work deadlines and ensure that work is covered during your absence.
2. Practice advanced planning:
   To accomplish deliverables on time while allowing yourself to take a rest from work, book the dates ahead of time. This makes way for a more organized workflow and a well-planned leave with no work conflicts in the future.
3. Be prompt in telling your manager:
   Companies usually require employees to submit time off requests at least two weeks in advance, giving managers enough time to approve the application and the workplace to make adjustments while you're on leave.

FAQs

Here are frequently asked questions that will further guide you in learning about PTOs as an employee:

What is the difference between PTO and sick leave?

PTO or paid time off is a general term used to encompass different types of leave including sick leave. PTO covers all kinds of paid absences, such as vacation, illness, or jury duty. Meanwhile, sick leave is only applicable for health-related absences.

How many days is 40 hours of PTO?

In an accrual time off policy, employees are allowed to accumulate time off from the number of hours they worked. Assuming it is an 8-hour workday, 40 hours is equivalent to 5 days of paid time off.

Is PTO your hourly pay?

No, PTO is not your hourly pay. PTO or paid time off is one of the benefits that allows employee's absences at work while still getting paid. These occasions include during sick days, vacation days, holidays, family or personal time, bereavement, and jury duties. Meanwhile, hourly pay is the salary rate at which workers are compensated in exchange for every hour they work.

Do you get paid on a PTO?

Yes, you get paid on a PTO. Paid time off lets companies pay employees regular wages during their absences from work as part of the company's employee benefits package.

Do you get PTO if you quit?

Some of the states that require companies to pay departing employees if it's stated in their policy are Alabama, Delaware, and the District of Columbia. Meanwhile, there are states that require companies to pay unused PTOs without exception, such as California, Colorado, and Nebraska.