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PTO bank vs. separate vacation and sick time banks
Benefits & Compensation
PTO bank vs. separate vacation and sick time banks
Exchange ideas about health plans, retirement, work/life benefits, and employee assistance.
Our nonprofit company currently accrues separate vacation and sick day "banks" for our full-time staff. We're curious whether other companies who recently switched from this type system to a PTO syste
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Forums » Topic Forums » Benefits & Compensation » PTO bank vs. separate vacation and sick time banks
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PTO bank vs. separate vacation and sick time banks
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PTO bank vs. separate vacation and sick time banks
posted at 4/23/2010 11:59 AM EDT
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Posts: 9
First: 5/6/2009 Last: 9/16/2010 |
Our nonprofit company currently accrues separate vacation and sick day "banks" for our full-time staff. We're curious whether other companies who recently switched from this type system to a PTO system feel that decision has/has not been cost effective. Our concerns are how to equitably convert accrued sick days to PTO (I assume accrued vacation days would convert 1 to 1), and that we'd likely end up paying out more if staff termed with large PTO banks made up of former sick days which under our current system would not be considered accrued and payable when staff term. Are there any cost benefits to a PTO system, other than administrative simplicity? Thanks. |
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PTO bank vs. separate vacation and sick time banks
posted at 4/23/2010 1:11 PM EDT
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Posts: 562
First: 11/12/2009 Last: 9/14/2011 |
You've summed it up pretty well - any cost savings from going to a PTO system result from somewhat reduced admin costs. And you will incur more liability for accrued PTO upon termination (I strongly suggest a cap at no more than 2X annual entitlement to control these costs).
The biggest benefit is in employee recruitment and retention. 3 weeks of PTO sounds a whole lot better than 2 weeks of annual vacation. And the employee gets to choose how the PTO is used. Most companies give 5 or 6 sick days. If that's the case with you, I'd convert on a 1 for 1 basis like you propose with vacation. If you do any less, it'll be perceived (rightfully) as a take-away. |
Forums » Topic Forums » Benefits & Compensation » PTO bank vs. separate vacation and sick time banks
