Employer-provided paid leave that bundles vacation, sick, and personal time into a single bank.
PTO bundles traditional vacation, sick, and personal days into a single bank that employees can use at their discretion. The trade-off: simpler administration, but employees may use less sick time when it shares the bank with vacation (or call out as "PTO" when sick, increasing presenteeism).
PTO interacts with state paid sick leave laws in nuanced ways — most state laws allow PTO to satisfy the requirement IF the PTO bank is sufficient and accrues at the required rate.
Employer-provided paid leave that bundles vacation, sick, and personal time into a single bank.
PTO bundles traditional vacation, sick, and personal days into a single bank that employees can use at their discretion.
Most PEO buying decisions touch several related concepts at once. Paid time off (PTO) typically comes up alongside the other terms in this category. Closely related terms include Paid sick leave, Paid family and medical leave.
This is one entry from our PEO glossary covering payroll, benefits, workers comp, HR compliance, and PEO mechanics. Browse all terms.
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