Creative PTO policies for maximum employee wellness

Wellness expert Mia Barnes details the different options for paid time off work to help you decide on a plan that ensures maximum benefit for employer and employees.

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Paid time off (PTO) is as beneficial as compensation for employees. Workers use it to improve their psychological well-being and take needed breaks. 

Policies vary per organization and its needs, but whether you are a large enterprise or a small startup, having a good PTO system is essential for attracting and retaining employees. 

Types of PTO

PTOs have different forms to appeal to employees and their needs.  

1. Traditional PTO

A traditional PTO is an older version where time-offs are categorized and numbered. For instance, you offer 10 paid vacation days and 15 sick leaves. The disappointing disadvantage is it feels like you are micromanaging your employees' personal time. 

2. Unlimited PTO

Top companies like Netflix have unlimited PTO benefits, allowing employees to thrive and have more freedom with their time. It is an unrestricted vacation or sick day policy, and workers can file for leave when and for however long they need. It sounds fantastic but compromises the accruing time off merits of tenured employees. 

3. Flexible PTO

Flexible PTO combines sick and vacation leaves and lets workers decide how to use them. For instance, instead of 15 sick days and 10 for vacation, employees can use 25 versatile days off per year. This option has all the benefits of an unlimited PTO policy, but the restricted number of days balances out the downside. 

Benefits of Flexible Time Off Policies

You want to structure PTO policies dynamically, as it is more sustainable. Nowadays, most workplace privileges, from work hours to vacations, are anchored on flexibility. Its benefits include:

  1. It rewards loyal employees with more time off every year they stay in the company.
  2. It attracts and retains top performers. 
  3. It gives people more control of their time. 
  4. It promotes inclusivity by accommodating the PTO needs of a diverse workforce, as not everyone celebrates the same holidays.
  5. It streamlines tracking and paying PTO.
  6. It makes workers feel valued.
  7. It empowers them to make better work decisions.

Tips when implementing PTO policies

In the U.K., full-time workers are legally entitled to at least 28 days of paid leave annually. You must acknowledge this fact when creating PTO rules, as failure to comply can hit you with fines and penalties. Here’s what to consider when making your own PTO rules.

1. How much PTO to offer

You'll attract more talent by providing more PTO annually, especially since mental wellness is a top workplace program. Obvious factors contributing to this are heavy workloads, low pay, and lack of work-life balance and social support. A similar pattern appears in the U.K., with 79% of survey respondents stating work stress as the most common type of pressure they experience. Personal time can significantly improve a worker's well-being and prevent burnout.

While the US does not mandate PTO, the UK government demands statutory annual leave entitlement to workers equivalent to 28 days or 5.6 weeks. This benefit extends to term-time workers or those working irregular hours. Use this calculator to know how much paid time off each employee class is entitled to for every hour they work.

2. Managerial approval

Setting a PTO approval process can help you sidestep insufficient staffing problems that can result in missed deadlines or backlogs. In a small business, requiring employees to get prior consent by filing a time-off request gives you or the manager enough time to coordinate coverage and adjust the team's schedule when a member is away.

When you have everyone’s leave schedule on view, you can see who has the extra bandwidth to take on the employee on leave’s tasks momentarily. Doing so prevents overloading someone with work. Simultaneously, a system like this creates a teamwork environment essential for employees' well-being. 

A good approach to implement this is by establishing a digital PTO approval process, such as via email or vacation tracker software, outlining the workflow employees must follow when filing for a leave. 

3. Set a notice period

Establish a reasonable deadline for calling in sick or filing for vacation time to prevent short-staffing. 

The notice period is generally at least twice as long as the number of leave days an employee wants to take, plus one day. For instance, a one-day leave demands three days' notice. Should the request conflict with scheduling and staffing, provide notice as much as the number of leave days filed plus one day. For 10 days off, give a decision 11 days beforehand. 

Booking and denying leave in advance ensures you are well staffed and have time to adjust staffing when necessary. Additionally, you can create a culture of respect with this policy in place.  

4. Consider how employees get PTO benefits

Decide if you want to provide the PTO benefits on a lump sum yearly or if workers need to earn them by accruing. For instance, a 40-hour-per-week worker earns eight paid hours off monthly. 

As employees are the main beneficiaries of PTO, it makes sense to ask for their feedback through a survey on how they want to accrue their paid time hours. Each may prefer it differently, so review the suggestions, determine what the majority wants and incorporate as many as possible into the policy. This will engage your employees and increase their satisfaction. 

5. Use it or lose it rule

Determine whether staff can roll over PTO hours at the end of the year. If they can, their unused time off is added to the following year, increasing their leave benefits. If not, they must use them before the year’s end.

U.K. employers are legally required to allow workers to carry over up to 20 out of their 28 days entitled leave credits if they were sick and could not take a holiday. Meanwhile, some companies may permit their staff to postpone eight days of outstanding time off for next year.

6. Allow wiggle room for adjustments

Refrain from cementing your PTO rules, as workplace policies are constantly changing. Solicit feedback from your staff on any modifications they think will improve your PTO protocols. Encourage them to participate in an employee engagement survey or questionnaire. Involving them in company decisions lets you know if the policies are right for them. 

Create employee-centered PTO policies

Your time-off conditions must put the employees' well-being at its heart. When it does, you avoid “quiet firing” and can attract new talent, retain loyal employees and provide an optimal working culture for everyone.

Every candidate considers PTO benefits when applying for a job, so ensuring you have policies supporting and upholding work-life balance makes you an attractive employer. More importantly, it shows future employees you value them by setting regulations benefiting their wellness. 

Mia Barnes - Founder and Editor-In-Chief of Body+Mind Magazine

Mia Barnes is a freelance writer and researcher with over 3 years of experience in the field. With a specialization in workplace wellness, financial well-being, human factors, and ergonomics, her articles aim to educate and empower readers, providing them with practical tips and insights to enhance their overall well-being in various aspects of their lives. Mia is also the Founder and Editor-in-Chief of the online publication, Body+Mind magazine.

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