paid time off – Workforce

March 6, 2023October 31, 2023

How to calculate PTO hours + accruals

Summary

Paid time off comes in many different types, including vacation, sick leave, personal leave, and bereavement time. – More
Your company can also choose to have workers accrue their time off, offer PTO up front, or even offer unlimited time off. – More
No matter your company’s specific time off policy, automatic PTO tracking software calculates leave for you and ensures proper coverage. – More

Workers are finally starting to take more time off for vacation and rest, a pretty significant shift in America’s always-hustling working culture. According to a Korn Ferry survey in 2021, 79% of workers said they planned to use more vacation days that year than in years past, and 82% said they would appreciate more vacation time in our post-pandemic world.

Paid time off (PTO) has always been valued by employees. 76% of American workers feel that it’s very important their company provides PTO. Paid sick time (74%) and paid holidays (74%) are also very important among workers.

Also read: Paid Sick Leave Laws by State

Employers can retain more workers, lower stress levels, and improve productivity among their workforce by developing a clear and fair PTO policy. But there’s no “one size fits all” approach to adopting the perfect plan for your company — you’ll have to sort out the right policy based on your workforce needs, then make sure you’re calculating time off banks correctly to help each worker get the time they’re entitled to.

Breaking down the types of PTO

There are a few different reasons why an employee might use their PTO. Depending on your company policy, they might use any available PTO day for any of these reasons, or they might have an allotment of days for each category.

Vacation: This is your run-of-the-mill bank of time for employees to use for day trips, staycations, travel, weddings, or the like. If it’s something they’re planning for, they’ll likely use vacation days.
Sick time: If an employee isn’t feeling well enough to work, they can take a sick day to rest up. Well-being also includes mental health; according to a survey by Breeze, 63% of respondents said they had taken a mental health day in the last year.
Personal days: Personal time is for when things happen outside the worker’s control. Maybe they’re stuck in a blizzard coming home from their in-laws, or they have to say goodbye to the family pet. Personal leave is there for life’s curveballs.
Parental leave: Companies aren’t legally required to offer paid parental leave, but some still offer it as a benefit to their workers. More businesses than ever were paying maternity and paternity leave benefits after the pandemic, but that trend is curtailing again. According to SHRM, 35% of companies offered paid maternity leave in 2022, and 27% offered paid paternity leave.
Jury duty: If an employee gets called in for their civic duty, their employer may choose to offer them PTO for at least part of their service.
Bereavement: Bereavement time is meant for employees who lose a loved one. Some companies only allow bereavement leave for close relatives. Workers can use this time to attend the funeral or other memorial services, or just take time for themselves to grieve without thinking about work.

How does PTO work?

You can allocate time off to your employees using a few different systems. In a traditional PTO format, workers accrue time off based on their hours or days worked. But more employers these days are leaning towards more flexible time off policies.

Accruing Time Off

With this type of policy, your workers will accrue time off based on every hour or day they work. The accrued time off will be added to their PTO bank, and they can take time off when they have enough hours banked. You can choose to lump all types of PTO together or distinguish between vacation and other types of PTO.

Usually, employees accrue different types of PTO at different rates. For example, for the year, your policy might grant ten days of vacation, five sick days, five bereavement days, and three personal days. Then, for each 40-hour workweek, employees will accrue their vacation time faster than their sick time, bereavement leave, or personal time. Employees with more years of service might also accrue more paid days of leave per year.

With an accrued time off policy, employees have to wait until enough time is banked to use their PTO. That means that you can’t just look at scheduling needs when weighing PTO requests — you’ll also have to track each worker’s banked PTO to ensure they have enough balance.

Unlimited Time Off

In an unlimited time off system, there’s much more flexibility for employees to take days off as they wish. There is no set number of days in an unlimited PTO system. Instead, employees can take off as many days as they’d like, for any reason, as long as the time off is approved by the company and they’re still fulfilling their individual responsibilities.

This flexibility can be a benefit to employees. There’s usually a level of trust that workers will take the time they need to stay rested and attend to personal matters while remaining productive at work.

However, an unlimited PTO policy also comes with some severe drawbacks. Studies show that employees, on average, take less time off under an unlimited policy than those who operate under a traditional policy. This is most likely due to a sense of guilt and other unspoken, toxic workplace stigmas around taking leave.

Just like in a traditional accrued time off structure, managers and company leadership still have to approve time off in an unlimited policy. If you opt for this type of format, the difference is you won’t be looking at the hours available in an employee’s time off bank. Before you approve any leave, you’ll still typically review factors like workforce coverage, scheduling needs, and productivity.

Under an unlimited PTO policy, you also don’t have to pay employees for the time off they’ve accrued when they exit your company. In a traditional PTO system, you do owe workers for any unused PTO time that they’ve banked during their tenure. When an employee leaves, they’re usually entitled to a payout of the days of PTO they accumulated.

How to calculate PTO

Small-business and startup consultancy Bizfluent notes that calculating PTO by pay period allows organizations to evenly distribute an employee’s time off accumulation throughout the year. Organizations with hourly or part-time employees should consider providing PTO based on the number of hours worked. When an organization calculates PTO hourly, it allows employers to award less PTO for hourly employees who do not report to work (for whatever reason) or for part-time employees who do not always work the same number of hours in a pay period.

One metric employers can follow to calculate PTO is dividing the annual PTO hours by annual work hours. For example, if an hourly employee earns 80 hours of PTO each year and works 40 hours a week, or 2,080 hours per year, divide 80 by 2,080. That works out to an employee earning 0.038 hours of PTO for each hour worked.

The PTO formula is:

Hours of PTO / hours worked each year = hours of PTO earned per hour worked

So in our above example, the organization’s PTO formula for this employee would be:

80 hours / 2,080 hours = 0.038 hours of PTO earned per hour worked

How to navigate common PTO challenges

Even if you set a clear PTO policy, there are bound to be situations or employee requests that fall outside of the policy that you’ll still have to balance. The key is to treat all employees fairly and accurately track PTO balances so you know exactly where you stand.

A sick employee has already used all their days.

Combining sick leave and vacation into one PTO category can lead to unplanned consequences for employees. If a sick employee has used all their PTO days, they might feel compelled to show up ill and risk infecting co-workers.

Help employees plan for this by offering guidance during onboarding or in posts throughout the year via internal communications about the importance of banking some PTO for sick days. For example, advise employees to consider paid time off as five days of vacation, four sick days or an unplanned emergency, and one day for a special occasion.

A new employee needs to use PTO days before accruing them.

Companies often hire employees with previous personal commitments for which they need time off after being hired. Prospective candidates often are honest and upfront about this as the hiring process progresses.

Since most policies establishing how to calculate PTO makes it hard for employees to take time off in the early months of their employment, many employers will allow employees to “borrow” their PTO. Allowing 40 hours of borrowed time gives an employee a full week off. To avoid lump accumulations and to calculate PTO more accurately, companies can implement earning PTO incrementally with each pay period.

If you allow your employees to borrow ahead on their PTO plan, you’ll need to track the borrowed hours accurately. You’ll also need visibility into the rest of your attendance and scheduling to quickly identify and resolve any coverage issues, especially for unplanned absences like a death in the family.

Tracking PTO doesn’t need to be difficult

Effective leave management is crucial for shift-based workforces. For one, it promotes employee well-being and reduces burnout. It also keeps you compliant with various wage and hour laws in your state. But most importantly, handling PTO properly keeps shifts organized and lowers the chance of scheduling mistakes.

You could manually approve, calculate, and track PTO across your workforce – this is fine enough for a small business. But one slight misstep can wreak havoc on timesheets and schedules. To save yourself the headache, utilizing an automated PTO tracker is a good idea. For shift workers, it is important that something like this be mobile-first and optimized for self-service; this way, the admin work is as non-intrusive as possible.

An app like this can do things like:

Automatically track leave balances
Calculate and apply PTO to timesheets
Prevent employees on leave from accidentally being scheduled
Allow employees to request leave and check their balances
Let managers review past and upcoming time off on a calendar
Allow managers to create custom accrual rates

Pretty sweet, right? If you want to learn more about how this all works, contact us today.

May 12, 2021

We are in the midst of a public mental health crisis; how employers can help

employers mental health; Millennials and mental health

Consider these statistics, courtesy of the National Institute of Mental Health, which recently examined mental health issues one year into the COVID-19 pandemic:

31 percent of people report symptoms of anxiety or depression.
13 percent report having started or increased substance use.
26 percent report stress-related symptoms.
11 percent report having serious thoughts of suicide in the past 30 days.

These grim numbers tell me that COVID-19 has created a national mental health crisis. At least some of your employees are struggling. Your challenge is what to do about it.

Here are four suggestions.

1. Check the benefits available to your employees. Do you have an employee assistance plan and are its mental health and counseling services are up to date? Are your health insurance plan’s mental health benefits easy to access and affordable? Do your employees know about state-offered resources, such as Ohio’s CareLine, a 24/7 community administered emotional support call service (800-720-9616)?

2. Revisit paid time off policies and consider providing employees the time they need to take care of themselves and their families. And understand that everyone’s situation at home is different. Some only have themselves to worry about, while others have families, older parents, etc. None of this is ideal, but for some, it’s less ideal than for others, depending on how much non-work responsibilities are on one’s plate.

3. Consider holding town halls or all-employee meetings that focus on mental health awareness. If senior leadership encourages education and communication around mental health issues, your employees will be more likely to access care if and when they need it. Leadership always starts from the top, and it’s vital that leadership leads on this issue.

4. Small gestures of kindness can go a long way. An extra day paid day off, a gift certificate for takeout meals or grocery deliveries or a surprise delivery of a mid-day snack can help employees feel appreciated and connected instead of overwhelmed and stressed.

Also, do not forget about or ignore your ADA obligations. The statute covers mental impairments no differently than physical impairments. If an employee is suffering from a mental illness you have an affirmative obligation to reasonably accommodate that employee, which might involve, for example, unpaid time off for the employee to obtain needed treatment.

Finally, do not ignore these issues or your employees who are living with them. Mental health illnesses are no different than other illnesses from which we suffer.

Treating them differently only increases the stigma that surrounds them and pushes individuals deeper into their illnesses and further away from the treatment they need.

February 10, 2021

Employee time off for the COVID-19 vaccine

At some point over the next few months, some (most?) of your employees will receive the COVID-19 vaccine.

Depending on the rules of your state, the nature of your business and the age or medical issues of your employees, some may already have. I’ve previously covered the legal issues surrounding the vaccine, here, here, and here. Today I want to cover a practical issue — time off related to the vaccination.

1. Please offer your employees paid time off to obtain both doses of the vaccine. To reach herd immunity (the only thing that will end this pandemic), we need between 75 and 85 percent of the population to be vaccinated. We want to make it easier for employees to be vaccinated, not more difficult. Please don’t make employees choose between their paychecks and a vaccine. The hour or two you will pay for the amount of time they spend getting vaccinated will pale in comparison to the weeks off they will need if they catch the virus.

2. Understand that a certain percentage of your employees will have a reaction to the virus and be too sick to come to work in its immediate aftermath. The most common side effects, which most commonly follow the second dose, include pain at the site of the injection, painful, swollen lymph nodes in the arm where the vaccine was injected, tiredness, headache, muscle or joint aches, nausea and vomiting, fever or chills. For some, these side effects will mirror the virus itself in causing a high, debilitating fever. These side effects typically last no more than 24 hours. If I’m you, I’m telling employees that if they experience side effects you will provide a paid day off for recuperation. Again, we want to have policies that encourage employees to get shots in arms, not forcing a choice between a paycheck and a vaccine.

This pandemic won’t end until enough people are vaccinated. Employers, do your part by having policies in place that encourage as many vaccinations as possible.

June 21, 2020April 11, 2023

Leave management should be as simple as submit, approve and hit the beach

Submitting a request for time off should be a simple, positive experience.

In most cases an employee seeking leave is looking forward to time away from the workplace. Their request to take time to relax and unwind shouldn’t get bogged down in a bureaucratic morass of an overly complicated process, further slowed by multiple approvals and unnecessary paperwork.

Let employees know their vacation is approved before they even book their travel plans through an intuitive online time management solution. Managers and supervisors also will appreciate the solution’s ease of use and rapid response so they can plan for that employee’s absence weeks or even months in advance.

Clear the confusion

Too often employees don’t know how much time off they have accrued or the amount they have left. Worse, managers are often in the dark about such employee basics as paid time off.

The employee approaches the manager to ask, “How much time off do I have left?” only to discover that the boss has no idea, either.

Frustrated, both begin to search for an answer. Naturally, it is either on a paper form tucked deep inside a hulking gray filing cabinet, or it is squirreled away among a previous manager’s archived spreadsheets, which of course is in a folder on an inaccessible server.

A mobile leave management solution makes such confusion and aggravation a thing of the past. Employers and employees enjoy ease of use and spend their time on tasks much more important than digging through a bank of filing cabinets.

Time off at their fingertips

A fully integrated leave management system literally fits in their pockets. Managers will always know who is available to work any shift with a quick glance at their mobile phone.

Innovative leave management software supports both mobile and desktop applications and implements approved requests directly into an employee shift schedule.

Online leave management benefits

Employers can customize leave management for multiple industries and global locations. Through quick implementation to the cloud, supervisors and employees also have a fair, transparent leave approval solution. Employers also increase their efficiency by shedding burdensome paperwork and save time and money by avoiding costly compliance complications.

Fair, transparent leave approval

Whether your organization uses paid time off or traditional vacation/sick leave, employees submit leave requests using their mobile devices. Managers can then review, approve or modify the requests. With ongoing, updated tracking, employee and supervisor both have access to records, balances and proof of compliance. Tracking time off helps optimize labor management for all employees.

Ease scheduling hassles

Every employee deserves time away from work, whether it is a weeklong vacation or a half-day doctor’s appointment. But when that worker’s time-off request is mismanaged it causes problems for the business, managers and fellow employees.

A simple, user-friendly mobile leave management solution is accurate, immediate and rebuilds the trust between employees and their managers that may have been damaged by a sloppy paper-based system.

Managers can see pending leave requests and check on employee availability, then make informed decisions on whether to grant or deny the time off.

Remain in compliance

Lax adherence to tracking employee leave and ignoring federal and state Family and Medical Leave Act compliance is the fast track to a lawsuit. A user-friendly, effective leave management system helps clarify FMLA and other regulations with intermittent or continuous employee-leave tracking to avoid litigation and costly fines that typically come with noncompliance.

Efficient records of absentee, sick leave, annual leave and timekeeping translates into accurate compensation and an engaged workforce secure in the knowledge that their leave requests will not fall through the cracks. A mobile leave management solution benefits the employer as well as the employee.

April 22, 2020June 29, 2023

I was (mostly) correct on the intersection between employer-provided paid leave and leave under the FFCRA

essential workers; workers' compensation, mask

Last week I took a stab at making sense of the messy and unclear rules surrounding the substitution of employer-provided leave (which, for the sake of simplicity, I’ll refer to as (“PTO”) for paid sick leave (“EPSL”) and expanded Family and Medical Leave (“EFMLA”) under the Families First Coronavirus Response Act.

I was (mostly) correct.

Also read: How to calculate PTO versus traditional sick leave and vacation policies

On April 21, the Department of Labor published its 5th set of FAQs discussing the FFCRA. Question 86 squarely addresses and clarifies the intersection between employer-provided paid leave and leave under the FFCRA.

1. An employer may not require that PTO run concurrently with—that is, cover the same hours as—EPSL.
2a. An employer may require that PTO run concurrently with the paid weeks of EFMLA. PTO that runs concurrently with EFMLA will enable the employee to receive 100 percent of his or her daily pay plus the EMFLA benefit (two-thirds of her or her regular rate of pay, capped at $200 per day and $10,000 in total). Note, however, that the FFCRA’s payroll tax credit only reimburses the employer for the paid leave provided under the Act, not for any concurrent PTO applied. Once an employee exhausts all available PTO, EFMLA is continued to be paid out of the statutory two-thirds rate.
2b. Alternatively, an employer and employee may agree to top off the two-thirds EFMLA pay to an amount equal to 100 percent of the employee’s regular pay. Again, the FFCRA’s payroll tax credit only reimburses the employer for the paid leave provided under the Act.
3. An employee may elect—but an employer may not require the employee—to take EPSL or PTO (but not both) during the first two weeks of unpaid EFMLA.

Crystal clear, right?

April 22, 2020June 29, 2023

Time off policies promote convenience while enhancing engagement

Some 768 million days of paid time went unused by American workers in 2018. That time amounted to about $65 billion in value.

While those statistics point to an American workforce that is overworked, it also presents an underlying problem many workers face: an organization’s time off policies that are poorly communicated, too complicated and overly cumbersome.

That could lead to employees shirking the system, which frustrates managers and angers payroll staff. Simplifying time off policies helps employers to more easily track their workforce’s vacation and sick time while allowing employees to take off the time they have earned.

Considering that some payroll systems are stuck in decades-old processes, an upgrade may sound easier said than done. But that’s not the case.

Even if a time off policy is locked in a paper-based 1980s time warp that’s as scary as Michael Jackson’s “Thriller,” employers can channel their “Old Town Road” and easily upgrade to a fresh, comprehensive 2020s system that promotes modern sensibilities through ease of use.

Here are four ways a tech upgrade can strengthen your organization’s PTO policy:

Simply simplify.

With a simplified time-off system, employees are more likely to take the time off they have earned and deserve. That leads to happier employees, which in turn leads to higher productivity. An updated time off policy includes features allowing employees to submit time off requests from any device at any time, making it a convenience rather than a cumbersome process.

Communicate your time-off policy capabilities.

Employees can be intimidated to take time off for whatever reason. And if they don’t know that their employer has upgraded to an employee-friendly, mobile-enabled time-off system they are less likely to request earned PTO. It’s clear that a rested employee is more productive. Your enhanced time off system also should provide an easy and effective way to communicate anything from a newly opened shift to a company’s time off policies.

Paperwork is a relic of the past.

A time off system that relies on technology rather than file folders and cold steel cabinets is not only a nod to a more mobile workforce but to the younger demographics of today’s working population. A mobile-friendly time off policy makes it easy to manage PTO requests and sends the message that you’re encouraging employees — especially millennials and Generation Z — that they should use their time.

Build a more productive, trusting workforce.

By encouraging employees to take their time off, rather than obfuscating it through some dim, impermeable system, employers can enhance engagement, promote transparency and build trust. Such employee engagement tactics lead to a more positive work environment. Streamlining the PTO process makes it easier for employees to use their paid time off and leads to a more productive workforce.

An engaged, rested workforce leads to a more harmonious and productive workforce. A mobile-friendly leave management system also allows employees to better plan for their time-off needs, switch schedules and communicate with one another. Workforce.com’s intuitive leave management provides seamless operations and provides tie-ins to scheduling and payroll.

April 13, 2020June 29, 2023

Making sense of substituting employer-provided leave for EPSL and EFMLA under the FFCRA

employment law, labor law, overtime records

One of the more confounding sets of rules under the Families First Coronavirus Response Act is when employers can require employees to substitute an employer’s own provided leave (which, for the sake of convenience I’ll refer to throughout as “PTO”) for paid leave — the 80 hours of paid sick leave (“EPSL”) or the 12 weeks of expanded family and medical leave (“EFMLA”) — mandated by the Families First Coronavirus Response Act.

I am going to make an attempt to explain these rules, but I’ll fully admit that it’s still not 100 percent clear to me. The text of the FFCRA seems to suggest that an employer can never require the substitution of PTO.

Also read: The DOL’s Families First Coronavirus Response Act regulations contain some big changes

The DOL’s proposed regulations, however, muddy the waters, which were muddied even further by an amendment to those proposed regulations published last Friday, which deleted language from the regulations’ explanatory discussion relating to the substitution of PTO for EFMLA.

So let’s try to sort it all out.

1. An employer can never require an employee to substitute PTO for EPSL. The employee can elect that substitution, but it can never be forced by the employer.

2. If an employee is taking leave to care for a son or daughter whose school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons, the employee qualifies for both EPSL and EFMLA. It is the employee’s sole choice whether to use EPSL during the initial two unpaid weeks of EFMLA (for which both types of leave will run concurrently), or save the EPSL for later use for another qualifying reason (or, I suppose, tack it on after the expiration of the FMLA leave). An employer cannot force an employee to use EPSL during those initial two unpaid weeks of EFMLA.

3. Here’s where it gets tricky. When can an employer require an employee to use PTO during EFMLA? Section 826.23(c) of the regulations is the key provision.

Section 2612(d)(2)(A) of the FMLA shall be applied, provided however, that the Eligible Employee may elect, and the Employer may require the Eligible Employee, to use only leave that would be available to the Eligible Employee for the purpose set forth in § 826.20(b) under the Employer’s existing policies, such as personal leave or paid time off. Any leave that an Eligible Employee elects to use or that an Employer requires the Eligible Employee to use would run concurrently with Expanded Family and Medical Leave taken under this section.

(Section 2612(d)(2)(A) of the FMLA permits an employer to require the substitution of PTO for FMLA leave.)

Also read: Coronavirus update: The mechanics of the tax credit for paid family and sick leave under FFCRA

What does this all mean? It means that an employer can require an employee to use available PTO during the unpaid portion of an EFMLA school closure of loss-of-child care coronavirus-related leave. If an employer so requires, the PTO runs concurrently with the EFMLA allotment.

4. An employer and employee can agree to “top-off” EPSL or EFMLA (that is, true up the employee’s pay through the substitution of PTO so that the employee earns his or her full pay). But the employer cannot require it.

All clear, correct? Or clear as mud?

Disagree with my interpretation? Drop a comment below and let’s try to figure it out together.

November 7, 2019June 29, 2023

Eggnog With a Splash of Paid Time Off

Providing employees extended time off at the end of the year is one way to add a bit of holiday cheer.

Office closures during the holidays — typically the days between or immediately around Christmas and New Year’s Day — can enhance employee productivity, according to a November 2018 survey of 2,000 full-time employees conducted by Chicago-based consulting firm West Monroe Partners. The study explored employee productivity during the holiday season and gauged how additional days off during the holidays affected that productivity. It found the “employees at offices that close additional days during the holidays are significantly more likely to report higher productivity during the time that they’re actually in the office” — 42 percent compared to 17 percent in offices that don’t shut down outside of federal holidays.

The study suggested that employers close the office on days beyond federal holidays, when feasible.

Some employers look at this potential benefit and can’t see past the missed productivity of those three or four days between Christmas and New Year’s, said Michael Hughes, a managing director with West Monroe and lead of the firm’s Operations Excellence practice. But they’re not considering the return on investment.

Also read: Experts Advise Revising Ailing Time-Off Policies

“In a tight job market, the ROI from deciding to close the office becomes very real,” he said. “We’ve tried this at our own company and [we] see the benefits of it year after year in terms of retention and productivity.”

According to the International Foundation of Employee Benefit Plans’ 2018 “Employee Benefits Survey,” 12 percent of organizations offer the full week between Christmas Day and New Year’s Eve as a paid holiday, compared to 9 percent of organizations in 2016.

If a company can withstand the hiatus from the client delivery and service perspective, it should strongly consider doing so.

Michael Hughes

Especially at a time with a tight labor market, employers are looking for new, innovative ways to attract talent and increase morale, said Julie Stich, vice president of content at the foundation. An extended vacation during the holiday season is one way to vie for candidates’ attention.

This makes sense in some industries more than others. The top three industries that offer holiday time off perks include education, technology and manufacturing. Conversely there are many industries in which virtually no companies offered such perks, including banking, finance, food service and health care, Stich said.

The top three industries provide examples for the type of environment that can more naturally offer this perk, Stich said. People in education may already have that downtime over winter break. Tech companies tend to be innovative in the benefits they offer. And manufacturers sometimes need to shutter their shops and turn off the machines for a week for maintenance. Offering that week between or around Christmas and New Year’s Day could fit in with a business need as well as give many employees the perk of a longer break, she added.

Hughes said that if a company can withstand the hiatus from the client delivery and service perspective, it should strongly consider this time off.

At West Monroe Partners, the finance and accounting teams are often working at the office or at home during this time of the year to meet end-of-year deadlines. The same goes for IT, as clients’ expectations of getting the necessary tech guidance does not stop just because it’s the holiday season.

One year a client experienced a ransomware attack the week between Christmas and New Year’s, Hughes said, and employees on the cybersecurity team stepped up, working on Christmas Eve and the days following Christmas. Instead of time off, these employees were recognized and rewarded in other ways for going above and beyond in their jobs.

“Folks in these positions understand this is a busy time based on their role in the company,” Hughes said. “As long as you provide them with a similar benefit — paid time off during another non-busy time in the year — or rotate who’s ‘on call’ from year to year, they are less affected by the decision.”

“If it’s not possible for your business to close for additional days during the season, then it’s even more important to offer workers alternative ways of disconnecting and recharging, such as greater scheduling flexibility,” he added.

Customer relations are something else to keep in mind. Organizations need to let their clients or customers know in advance that they will not be providing services over a certain period of time. They can’t just rely on an update on their website to get the message across, Stich said.

August 19, 2019June 29, 2023

Is It Legal to Dock the Pay of Employees Who Skip a Political Rally Being Held in the Workplace?

Has an employer violated the law if it docks the pay of an employee who skips a speech being given by President Donald Trump in their place of employment?

Over the weekend news broke of a Pennsylvania employer who had an interesting way to influence its employees’ attendance at a rally Trump was holding at their place of employment during the work day. Only pay those employees who show up.

“NO SCAN, NO PAY,” a supervisor wrote to his employees.

While attendance at the rally wasn’t mandatory, the employer told its employees that they would only be paid for the work day if they attended. Otherwise, they had the option to take a PTO day or take the day off excused and without pay.

While it sounds terrible to withhold pay for employees who choose not to attend a political event during the work day, just because it’s terrible doesn’t make it illegal.

Indeed, in all likelihood, there is nothing illegal about this practice. That said, I can envision a few arguments that could give this employer trouble.

1. You might jeopardize an exempt employee’s overtime exemption. One of the cornerstones of the FLSA’s exemptions is that the employee must be salaried. By definition, a salaried employee receives the same predetermined amount of money for each week worked. Employers can jeopardize exemptions by docking employees’ pay for hours or days missed from work. If an employer reduces an employee’s pay for hours or days missed in a week, the employee is not receiving a standard predetermined amount for all work performed during the week, and therefore no longer salaried. If an employee is not salaried, he or she cannot be exempt. Exemptions are bad things to lose, because it would make an employee eligible for overtime. Thus, paying an employee four-fifth’s of his or her salary for a four-day work week might jeopardize that employee’s exemption.

2. You operate in one of the few jurisdictions in which political affiliation discrimination is illegal. “Political affiliation” is not a protected category protected by any federal law. Still there are a few states that protect it under their own anti-discrimination laws. In California, for example, an employee docked because he or she chose not to attend a rally of a politician they did not support would have a cognizable claim for political affiliation discrimination.

3. You’ve violated an employee’s right under section 7 of the National Labor Relations Act to engage in protected concerted activity. Private employers cannot prohibit discussions by and among employees about wages, benefits, and other terms and conditions of employment. Therefore, if employees skip the Trump rally as part of a mass protest over how his policies impact the workplace, then it might be unlawful for their employer to dock their pay as a result.

Legal or illegal, however, you need to ask yourself whether coercing employees’ attendance at a political event is a legitimate business practice. How you answer the question of whether you think it’s OK to try to shape or influence your employees’ votes helps to define the kind of employer you are. Voting is an intensely personal choice. I don’t think it’s my business how my family members cast their votes.

I certainly don’t think it’s an employer’s business how its employees cast their votes. Voting booths have privacy curtains for a reason. Exercise some discretion by not invading that privacy of your workers.

August 9, 2019June 29, 2023

Unlimited Paid Time Off Is a Deceptive Ploy in Today’s Workplace

Employees may be lured by the idea of unlimited paid time off but the reality is unlimited paid time off is often an egregious fabrication that employers tell their workforce.

What is usually lost in the conversation is what employees are forced to give up when their organization decides to implement an unlimited system. There are plenty of legitimate business reasons to stop offering — and stop being enamored by — the allure of the unlimited PTO promise.

“It’s great to not have to pay out [accrued vacation] when people leave,” said Maggie Grover, a partner at Wendel, Rosen, Black & Dean LLP in an interview with website HR Dive. “Because people are so connected and working even when they’re technically off, they tend to take fewer full vacation days. So even if you cap a vacation bank at 1.5 or 2 times the annual accrual amount, the payout at the end of the employment relationship can still be significant.” And just to note, not all states require employers to pay out accrued vacation.

Recognizing that this is a large financial obligation, many companies are relieving themselves from these obligations by offering unlimited policies.

Employees also can’t save or accrue “unlimited” vacation time to use next year. When it comes time to transition from the company, the employer has no obligation to pay out the extra hours of productivity that were used in lieu of taking a break.

According to outplacement firm RiseSmart, an unlimited PTO policy “significantly reduces the costs of having to pay employees for unused PTO and may be one of the most compelling factors for companies considering an unlimited PTO policy.”

Unlimited vacation is a work-around, plain and simple. By offering this perk, companies get away from tracking and accruing a liability that in some states, once accrued, is considered earned wages. And once wages are considered earned, they must be paid out at departure or termination.

Less Time Off for Employees

Some studies show that American employees today often end up taking little or no more time off in an “unlimited” system compared to when they have a set number of days off each year.

In a study by HR platform Namely, research suggests that employees with “unlimited” vacation actually take fewer days off (13) on average than those with a limited number (15).

Unlimited PTO Is No Win-Win for Today’s Talent

Unlimited PTO sounds generous on a job description, but employees by and large end up getting paid less with no value attributed to their PTO while companies gain more of their employees’ productivity.

This latest benefits trend is harming the workforce and leading mass groups of employees to forfeit the second most important job benefit with no way to monetize or reutilize the value of their PTO.

Companies need to ask if they’re making these changes for employees or for their bottom line. If, let’s say, employees are using 100 percent of their PTO and a company wants to decrease expenses, then perhaps such a program makes sense. However, this is generally not the case today. Employees thus leave billions of dollars worth of unused PTO on the table.

Are benefits a meaningful way to attract, engage and retain employees? Absolutely.

Will unlimited PTO be a mainstay of the future of work? Absolutely not.

Instead of unlimited, employers — and talent — should be thinking in terms of flexible, diverse and portable benefits to mirror the workforce today.