Manage time off policies

• Bereavement (Plus and Premium plans only)
• Floating holiday (Plus and Premium plans only)
• Holiday pay (Plus and Premium plans only)
  • Employees will be paid for all holidays included if they are enrolled in the policy.
  • You can only set up one holiday pay policy 
• Jury duty (Plus and Premium plans only)
• Learning and development (Plus and Premium plans only)
• Paid time off (Simple, Plus, and Premium plans)
• Parental leave (Plus and Premium plans only)
• Personal day (Plus and Premium plans only)
• Sick (Simple, Plus, and Premium plans)
  • Some cities and states have mandatory sick time and/or emergency sick time regulations—be sure to check your state’s mandatory sick leave policies.
• Unpaid (Plus and Premium plans only)
  • No other policies can be set to unpaid.
• Volunteer (Plus and Premium plans only)
• Weather (Plus and Premium plans only)
• Custom policy (Plus and Premium plans only)

Learn more about how time off policies work in Gusto before you get set up.

1. Click the Time tools section and select Time off.
2. Click Add Policy.
3. From the dropdown, select the policy type you’d like to create.
4. Name the time off policy.
   • Some cities and states have mandatory sick time regulations—be sure to check your state’s mandatory sick leave policies. If applicable, you can set up and name a sick policy that applies to your employees in that given state or city.
5. Select Yes, there is a limit to the amount of time off your team can take.
   • When an employee is dismissed, time off in a limited policy will automatically be paid out on their dismissal paycheck.
6. Select the way you’d like your team to accrue hours.
   • For fixed: Enter the total time off per year and how it’s earned.
   • For hourly: Enter the amount of time off hours that employees will accrue based on the actual number of hours worked.
7. Click Save & continue.
8. Choose if you want employees to go through a waiting period before they can start accruing hours and requesting time off. If so, enter how long it is.
9. Choose if you want your employees to have a max balance per year. If so, enter that amount.
   • Once your employees reach the max balance, they'll temporarily stop accruing time off. If their balance falls below the max, they'll start accruing time off again.
10. Choose if you want your plan to have a carryover limit.
11. Select the dismissal payroll settings by choosing if you would like employees to be paid out their remaining unused time off balances.
12. Click Save & Continue.
13. Choose if you’d like your employees to earn by tenure. If so, enter the anniversary when they’ll begin to earn additional hours and the total they’ll receive. Then, click Add Milestone. 
    • PTO will accrue for an anniversary date only if the anniversary date is the first day of the pay period. If the anniversary date falls in between a pay period, the accrual will take place on the following payroll.
      • Anniversary Date: Dec 1, Pay Period Nov 27 - Dec 8 PTO will accrue on the following payroll.
      • Anniversary Date: Dec 1, Pay Period Dec 1 - Dec 15 PTO will accrue on this payroll.
14. Click Save & Continue.
15. Click the + icon next to the employees you want to enroll. 
16. Click Save & Continue.
17. Add any existing balances for employees. 
    • If your employees have an existing balance, enter those hours.
    • Employees moving to this policy from another will carry over their accrued hours.
18. Click Create Policy.

You can view and update your policy by clicking Time tools and selecting Time off. 

For Plus and Premium customers, we recommend you also set up time off requests for your team. This enables your employees to request time off in Gusto and automatically records the hours in payroll once they’ve been approved.

Learn more about how time off policies work in Gusto before you get set up.

1. Click the Time tools section and select Time off.
2. Click Add Policy.
3. From the dropdown, select the policy type you’d like to create.
4. Name the time off policy.
5. Select No, it's unlimited.
   • When an employee is dismissed, time off in an unlimited policy will not pay out on their dismissal paycheck.
6. Click Save & continue.
7. Click the + icon next to the employees you want to enroll. 
8. Click Create Policy. 

You can view and update your policy by clicking Time tools and selecting Time off. 

For Plus and Premium customers, we recommend you also set up time off requests for your team. This enables your employees to request time off in Gusto and automatically records the hours in payroll once they’ve been approved

If you need to add or remove employees to/from a time off policy that's already been set up, you can do so in your admin Gusto account. 

To add an employee to a time off policy:

1. Click the Time tools section and select Time off.
2. From the "Policies" tab at the top, scroll to applicable policy. 
3. Click the 3-dot menu icon.
4. Click View.
5. Click Add or remove employees at the bottom of the page.
6. Add the new employee.
7. Click Save policy.

Note: you'll need to set up a time off policy first. Learn basic information about time off policies here, where you'll also find a step-by-step guide to setting one up. 

To remove an employee from a time off policy:

1. Click the Time tools section and select Time off.
2. From the "Policies" tab at the top, scroll to applicable policy. 
3. Click the 3-dot menu icon.
4. Click View.
5. Click Add or remove employees at the bottom of the page.
6. Click the X next to the employee you would like to remove.
7. Click Save policy.

Note: You'll need to set up a time off policy first. Learn basic information about time off policies here, where you'll also find a step-by-step guide to setting one up. 

Once you’ve completed setting up time off, you can edit or cancel your policy at any time. 

Information you can change at any time:

• Policy name
• Policy description
• The accrual method
• Waiting period
• Max balance and carryover limit

To edit a time off policy:

1. Click the Time tools section and select Time off.
2. Click the Policies tab.
3. For the policy you want to change, click the three dots on the right and click Edit. 

Any changes you make to your policy will affect all enrolled employees.

To delete a time off policy:

1. Click the Time tools section and select Time off.
2. Click the Policies tab.
3. For the policy you want to delete, click the three dots on the right and click View. 
4. Click Delete Policy in red on the right-hand side.

If you're unable to delete the policy, it means there are still pending time off requests. These requests will need to be deleted before you can delete the policy.

Once a policy is deleted, employees will no longer accrue or be able to request time off, but their balances will remain on file if you should want to readd the policy at a later time.

You can keep track of paid holidays for when your employees do not work but receive regular wages and Gusto will automatically pay your team for those holiday hours when you run payroll.

Just like a sick policy, this type of policy should be added if employees are not working but being paid for their time away.

Reminders

• Employees will be paid for the full 8 hour holiday day. 
• Federal holidays will be observed on Friday or Monday, if the holiday falls on a Saturday or Sunday respectively. 
• Federal holidays selected will automatically apply to all future years.
• Custom paid holidays will need to be created individually for each year and you can create holidays up to three years in advance.

Create a holiday pay policy

1. Click the Time tools section and select Time off.
2. Click the Polices tab.
3. Click the Holiday Pay tile.
4. Select your company's paid federal holidays.
   • We'll automatically count them as paid time off when you run payroll.
5. [Plus and Premium customers only] Click Add Custom Holiday if you'd like to add your own company holidays here (i.e. day after Thanksgiving).
   • Name your holiday.
   • Enter a date range for the holiday and click Save.
   • If a custom holiday date range overlaps with a preexisting Federal holiday, Gusto will not double-count the holiday hours for that day.
   • The Custom Holiday PTO feature is available to Plus and Premium customers - upgrade your plan at any time.
6. Review all holidays and click Continue.
7. Add employees you'd like to enroll in the Paid Holiday policy.
8. Click Create Policy.

You can now sync the holiday pay schedule to your personal calendar if you would like. Employees will also be able to see the holiday schedule in their Gusto dashboards.

Once you've set up a holiday pay policy, you can make the changes below as needed. 

 Remove a paid Federal holiday

1. Click the Time tools section and select Time off.
2. Click the Policies tab.
3. Scroll to the Paid Holidays policy and click the three dots on the right-hand side.
4. Click view.
5. Click edit under Federal Holidays on the right-hand side to change the current settings.
   • Changes made to Federal Holidays will only affect future dates.
6. Uncheck or check the desired Holiday name.
7. Click Save.

Change or delete a custom holiday [Plus and Premium plans]

1. Click the Time tools section and select Time off.
2. Click the Policies tab.
3. Scroll to the Paid Holidays policy and click the three dots on the right-hand side.
4. Click view.
5. Click edit next to the custom holiday.
6. You can edit the custom holiday title and date.
7. Click Update holiday to save changes or exit.
8. If you need to delete the custom holiday entirely, click Remove Custom Holiday.

Custom holidays are available to Plus and Premium customers - upgrade your plan at any time. Once a policy is deleted, employees will no longer accrue or be able to request time off, but their balances will remain on file if you should want to readd the policy at a later time.