Is it a sick day? Vacation? With PTO, it doesn’t matter
At small businesses this summer, many owners won’t be trying to figure out whether employees will be counting it as vacation time, personal days or sick leave when they send texts or emails that say, “I’m not coming in today.”
A growing number of companies combine vacation and sick time into one bucket called paid time off, or PTO. Staffers decide whether they’re going to use the days for vacation, when they or a relative are ill, or for family events.
“You’re saying to staffers, it’s PTO, just take it. If you have a sick kid, need a personal day, you’re really stressed out,” says Gretchen Van Vlymen, a vice president at StratEx, an HR consulting firm based in Chicago.
Forty-three percent of companies offered PTO in 2016, up from 28 percent in 2002, according to a report from World at Work, an association of human resources professionals. The report said 51 percent of private companies, which would include small and mid-size businesses, offered PTO.
One of the biggest pluses about PTO for small business owners is eliminating the administrative chore of tracking how many sick days versus vacation days their employees have used. That can be particularly helpful in the growing number of states, counties and cities where employers are required to allow staffers to accrue sick time, usually up to 40 hours a year depending on how many hours they work. With PTO, there’s no need to track hours worked or accrued.
For Will Gadea, offering PTO to his five staffers means he doesn’t have to be the arbiter of whether someone is really sick when they call him in the morning, coughing and asking for a day off.
“I don’t want to make employees lie to me in order to use those days up,” says Gadea, owner of IdeaRocket, an animated video company in New York.
But PTO may not stop those workers who habitually call out on Mondays or after long holiday weekends. And some staffers may decide to work when they’re sick rather than use days they want to set aside for a vacation.
Employers need to deal with such situations from a performance perspective, says Kate Zabriskie, CEO of Business Training Works, an employee development consultancy based in Port Tobacco, Md. That means talking to workers if they come in sick and letting them know they’re probably better off at home.
Van Vlymen suggests talking with the staffer who tends to call out after weekends, noting there’s a pattern and letting them know that if they have a problem of some kind, help is available.
Another issue can be if an employee runs out of time. It can happen if they take vacation time, some personal days for school events or to be home with sick kids, and then get the flu at the end of the year.
When a staffer is running out of days, especially if it’s a highly valued employee, it can be tempting for the boss to say, “Don’t worry, we’ll pay you for the days you missed.” But unless other employees also get extra days, the boss’ leniency can be seen as unequal treatment.
“You need to remain consistent. You can’t look the other way for one person,” says Eric Cormier, a consultant with the Houston-based HR provider Insperity.
One solution is that if staffers are able to work from home and aren’t too sick, they can telecommute to avoid using PTO.