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U.S. Employers Offer PTO to Compete in the Labor Market

Wiorld at Work
June 30, 2010

June 30, 2010 — Three out of four survey participants report that they find it necessary to offer paid time off (PTO) programs as an employee benefit, and they're doing it in both traditional and nontraditional ways.

"Time is the new currency, and employers remain committed to providing paid time off as a key employee benefit and reward," said Lenny Sanicola, benefits practice leader for WorldatWork.

The WorldatWork research report, "Paid Time Off Programs and Practices," found that current PTO programs include the traditional system (preferred by large organizations), the PTO bank-type system (steadily increasing in popularity) and unlimited leave:

54% of companies still use a traditional system, which gives employees separate allotments for vacation, personal and sick days.
40% of employers use a PTO bank model, up from 28% in 2002. In these plans, workers receive a pooled number of days off that can be used as needed (generally excluding fixed holidays, jury duty and bereavement).
1% of organizations offer unlimited leave, wherein an employee can take as many days off as needed

In a congressional briefing held today, Cara Welch, director of public policy for WorldatWork, said, "With the focus of the administration and Congress on expanding access to work-life benefits such as paid leave programs, our research report shows that employers recognize the competitive advantage of offering paid time off and believe in continuing these programs, even through the recession."

Other key findings:

100% of survey respondents offer paid time off.
In a traditional system, 21 days (12 paid vacation plus 9 sick days) are allocated on average for one to two years of service; 19 days in a PTO bank system.
A majority of employers (all organizations with a PTO bank system and 87% with a traditional system) provide paid sick leave. The average number of paid sick days in a traditional system is 9. PTO bank systems do not distinguish between vacation and sick time.
Employers offer an average of 9 paid holidays each year.
15% of participating organizations offer sabbatical leave programs (typically unpaid).

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