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Understand PTO terminology

Tenure: The period or term of holding a position. Sometimes used to determine when an employee will get an increase in PTO. For example, an employee receives an additional 24 hours of PTO after 2 years of tenure with their company.

Waiting period: The allotted period of time an employee must wait before they can begin accruing PTO. For example, an employee must have a 30 day waiting period before they can accrue PTO at their company.

Maximum balance: The maximum amount of PTO hours that an employee can have at any given time. If an employee has reached their max balance but uses some time off during a given pay period, they may still accrue back up to their max balance. For example, an employee earns 10 hours of PTO every month, but they have a max balance of 20 hours total. 

Carry-over limit: The amount of accrued (or unused) PTO that can be carried over from one calendar year to the next. Some employees earn more PTO on the anniversary of their hire date, while others earn it on January 1.

Questions and answers 

Q: When will annual PTO accrue?

A: Annual PTO will accrue when the payroll that includes the anniversary date is paid out. For example, if the anniversary is January 1, when the January 1 - 15 pay period is paid out, the amount will accrue.

However, if the payroll includes time from the previous year (such as a period from December 26 - January 10), the employee won't see the accrual until the next payroll fully in the new year (the January 11 - January 25 payroll in this example). 

Q: Do time off balances automatically zero out at year's end?

A: No, some state sick time mandates do not allow for time off balance resets, so balances will not automatically zero out at year's end unless a payroll admin manually zeroes out the balance on an account.

Q: Can an employee go into the negative time off?

A: Yes, a time off balance will go negative automatically if an employee uses vacation they do not have. A payroll admin can also save a negative balance in the employee's details screen under the time off tracking section.

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