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Benefits Cost Per Person
Benefits & Compensation
Benefits Cost Per Person
Exchange ideas about health plans, retirement, work/life benefits, and employee assistance.
Should you include PTO in calculating benefits cost per person? Are there any good templates or resources for doing this?
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Forums » Topic Forums » Benefits & Compensation » Benefits Cost Per Person
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Benefits Cost Per Person
posted at 4/22/2011 7:44 AM EDT
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Posts: 562
First: 11/12/2009 Last: 9/14/2011 |
Most definitely you should - it's one of the top benefit cost items.
If you're calculating on an individual employee basis, simply use the employee's weekly salary/wages X weeks of annual PTO entitlement to calculate the cost. |
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Benefits Cost Per Person
posted at 4/25/2011 4:40 AM EDT
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Posts: 2442
First: 2/12/2000 Last: 9/14/2011 |
"If you're calculating on an individual employee basis, simply use the employee's weekly salary/wages X weeks of annual PTO entitlement to calculate the cost"
Please note that there is an important distinction one should make when deteriming the cost or value of certain benefits. When you are talking about additional direct outlays of company funds like payments to insurance companies that is one type of cost. When you are talking about all paid time off plans, they are not an additional cost but rather an indirect cost. If you pay an employee an annual base pay of $50,000 per year, the direct cost is the same regardless of how many days the employee actually comes to work. So paid time off schemes like PTO, Holiday Pay short term sick pay (non insured) do not add directly to the companies financial statement as a cost. Rather it is an indirect cost where the real cost is the lost of productivity. Should you include it. Absolutely as Nork stated. Just note it differently as it should not be added to direct cost. |
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Benefits Cost Per Person
posted at 4/25/2011 6:18 AM EDT
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
My thought was the same as Howards.
It is not in my direct cost calculation like other benefits (401k match, STD/LTD employer paid, health, dental, etc). Because it is an indirect cost that is already a part of the original salary for those paid salaried. You could do the calculation to see how much of the salary goes to PTO if you wanted an idea overall -- especially if different employee groups get different PTO levels. Might be interesting to figure out! |
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