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Paid Time Off
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Paid Time Off
Discuss employment-law issues such as family leave, overtime, disabilities law, harassment, immigration and termination.
My company has recently revised their Paid Time Off (PTO) policy, to be in compliance with IRS guidelines. However, it seems to me like they may be violating worker rights. They used to allow employee
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Forums » Topic Forums » Legal Forum » Paid Time Off
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Paid Time Off
posted at 5/12/2003 5:45 AM EDT
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Posts: 1
First: 5/12/2003 Last: 5/12/2003 |
My company has recently revised their Paid Time Off (PTO) policy, to be in compliance with IRS guidelines. However, it seems to me like they may be violating worker rights. They used to allow employees to sell back unused PTO once a year, but this has caused concern regarding the IRS statutes and withholding requirements. In order to be in compliance they are still allowing employees to sell back PTO, but the employee has to let them know in January how many hours of PTO they want to sell back in June. Employees sign an agreement and if something happens that the employee needs the PTO before June it is unavailable to them, they must wait until June to receive a check and they would have to take the time off without pay. Also if employees are terminated (voluntary or involuntarily) before June, they lose the PTO that they had indicated that they wanted to sell back. The PTO is a bank that includes both sick leave and vacation leave. My concern is the legality of requiring employees to commit to PTO use 6 months in advance of dispersal, and then to sanction the employees by taking away the benefit if extenuating circumstances necessitate the need for the PTO prior to June. Please comment.
Thank you, Pam Wilkie |
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Paid Time Off
posted at 5/12/2003 12:41 PM EDT
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Posts: 3870
First: 2/12/2002 Last: 11/2/2009 |
This almost sounds like your organization has set up a Section 125 type of tax deferred program for PTO to save some money (eg, FUTA/FICA etc). I'm not sure that this is permitted under IRS regs since I believe this type of arrangement is intended solely for health and welfare plans, but it's an intriguing idea if it could be extended.
I do see a problem with forfeiture of PTO should the employee terminate. Depending on the type of plan you have and the state you're in, any state requirement to pay out accrued PTO upon termination would override the forfeiture provision. |
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Re: Paid Time Off
posted at 6/6/2012 5:42 AM EDT
on Workforce Management
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Posts: 4
First: 6/6/2012 Last: 4/26/2013 |
Hey, Does your company uses any time off software to calculate the paid time off? There are such tools available that make it so easy for better project and time management. I am not sure about the legal issues still know that any such solution would be helpful.
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Re: Paid Time Off
posted at 6/6/2012 8:44 AM EDT
on Workforce Management
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Posts: 215
First: 9/20/2011 Last: 5/14/2013 |
In Response to Re: Paid Time Off: Hey, Does your company uses any time off software to calculate the paid time off ? There are such tools available that make it so easy for better project and time management. I am not sure about the legal issues still know that any such solution would be helpful. Posted by braden NINE Year old original posting................. |
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