If you think that offering your employees paid time off is a luxury your business can’t afford, you may want to think again. Paid time off is a highly desirable employee benefit that can help your business remain competitive, mainly by attracting and retaining quality employees.
Not only that, but it can also help you run a more efficient business. That’s right! Giving employees time off actually contributes to productivity. Sound good? Read on for more insight.
Paid time off, or paid leave, is any time that your business pays an employee wages when he or she is not working. This may include holidays, vacation time, sick time, bereavement leave and personal days.
Many companies offer paid time off for holidays such as New Year’s Day, Memorial Day, Thanksgiving and Christmas. Some even close their offices on these days, while paying their employees for the time. Extending this to other holidays — and offering additional paid time off options — can go a long way toward helping you hire and manage more motivated and satisfied employees.
Paid time off extends numerous advantages for both your staff and your business’ bottom line. The most compelling reasons to offer it include:
Offering a bank of paid time off (PTO), rather than a specific number of hours for sick days or vacation days, is easier to administer. It also can be more appealing to employees, particularly those who rarely need sick days, because they may use the time off for any reason not just when sick. You can offer a PTO plan on an accrual or annual basis. With an accrual approach your employees earn paid time off based on the number of hours they have worked, or years of service provided. You can require a minimum employment period (such as six months) before it applies, as well as a maximum number of hours that can be accrued. If you’re offering PTO on an annual basis, you should provide all employees a specific number of paid days they’ll receive each year based on, say, their anniversary date.
Whatever your paid times off benefits are, it’s important to put them in writing in a time off policy. Spell out eligibility, the process for requesting time off, whether it can be denied and how unused paid time off is handled.
While U.S. companies aren’t required under federal law to offer paid vacation time or holidays, it’s commonplace in many industries. Keep in mind, too, that more generous benefits may apply on a state level. Nine states and Washington, D.C. currently require paid sick leave. In addition, paid family leave is required in California, New Jersey, New York and Rhode Island. It may also be necessary to offer paid time off for jury duty or paid (or unpaid) leave to fulfill military reserve training duties. Further still, in 27 states, companies may need to compensate employees for unused paid time off, which makes time off tracking especially critical.
You can handle time off much more effectively with a consistent, online tool that simplifies the process. The Time Off Request Smart App features a built-in workflow for a hassle-free request and approval process, as well as clear, on-screen visibility to ensure proper staffing. With an automated request, approval and documentation process, you’ll never forget or lose track of an employee’s request for time off.