Paid Time-Off Benefits

When designing a competitive and comprehensive total rewards plan, it is important to consider the value of paid time-off benefits to employees and the cost to your organization. Results from a recent Culpepper Benefits Survey show that an increasing number of U.S. and Canadian employers are improving their PTO benefit programs by making them more flexible and generous.

Key Findings

56% of companies have a traditional PTO model with days allocated to specific categories (e.g., vacation, holiday, sick & personal leave).
41% of companies have a PTO bank model with a pool of days.
18% of companies allow employees to cash out unused vacation and PTO days.

Types of Paid Time-Off Models Used
Most U.S. and Canadian organizations use a traditional paid-time off model with days allocated to specific categories (e.g., vacation, holiday, sick & personal leave). Forty-one percent of companies have PTO bank models combining vacation, sick, and personal days into one pool, allowing employees to take time-off for any reason (Table 1).

Table 1: Types of Paid Time-Off Models Used
	Traditional Model with specified # of sick & personal days	Traditional Model without specified # of sick or personal days	PTO Bank Model	Other Models
All Companies	45%	11%	41%	3%
Number of Employees
Up to 100	46%	8%	42%	4%
Over 100 to 1,000	45%	12%	42%	1%
Over 1,000	41%	16%	38%	5%
Industry Sector
Technology	47%	9%	42%	2%
Life Sciences	50%	10%	38%	2%
Other	30%	22%	39%	9%
Corporate Status
Private	45%	9%	42%	4%
Public	50%	14%	35%	1%
Non-Profit	43%	28%	29%	0%

Paid Time-Off Eligibility Periods
Fifty-two percent of companies allow new full-time employees to take paid time-off immediately upon hire. One-third of companies require new employees to wait over 30 days before they can take paid time-off (Figure 1).

Paid Time-Off Accrual Schedules
The most common schedule for accruing paid time-off for existing full-time employees is
bi-weekly (Figure 2).

Number of Paid Time-Off Days
Table 2 shows the number of days provided by paid time-off model, type of time-off, and tenure.

Table 2: Number of Days by Paid Time-Off Model, Type of Time-Off, and Tenure
	25th Percentile	50th Percentile	75th Percentile
*Traditional Model with* specified number of sick & personal days**
Designated Holidays	8	9	10
Floating Holidays	0	1	2
Sick & Personal Days	5	6	10
Vacation Days
1 Year of Employment	10	10	15
5 Years of Employment	15	15	18
10 Years of Employment	15	20	20
15 Years of Employment	20	20	21
20 Years of Employment	20	20	25
*Traditional Model without* specified number of sick & personal days**
Designated Holidays	8	9	10
Floating Holidays	0	1	2
Sick & Personal Days	*	*	*
Vacation Days
1 Year of Employment	15	15	20
5 Years of Employment	15	20	20
10 Years of Employment	20	20	20
15 Years of Employment	20	20	25
20 Years of Employment	20	23	25
PTO Bank Model
Designated Holidays	8	9	10
Pool of Unspecified Days
1 Year of Employment	15	15	19
5 Years of Employment	20	20	24
10 Years of Employment	21	25	27
15 Years of Employment	23	25	28
20 Years of Employment	24	25	30
* Some traditional models allow an unspecified number of sick & personal days.

Other Paid Time-Off Policies and Benefits
In addition to the data tables and figure above, we provide a more comprehensive report with additional data on the following paid-time policies:

Treatment of Vacation and PTO Days

Mini-Vacations: Paid time-off in hourly increments.

Donate Vacation and PTO Days to Other Employees

Buy or Sell Vacation and PTO Days (between employees)

Paid Sabbaticals

Unlimited Leave Paid Plans

The comprehensive version of this report with the additional data is available to:

Participants in 2008 Paid Time-Off Benefits Survey
Subscribers of Culpepper Benefits Surveys

Data Source: Culpepper Benefits Survey of 279 organizations.
Survey Dates: March-May 2008

Breakdown by Industry Sector:
Technology:

Aerospace & Defense 3%, eBusiness 3%, Hardware & Electronics 6%, IT Services: 11%, Semiconductor 3%,
Software 30%, Telecom/Internet Services 7%, Other Technology 4%

Life Sciences:

Biotechnology 4%, Medical Devices/Equipment 6%, Pharmaceutical 2%, Research Services 2%,
Other Life Sciences 1%

Other Industry Sectors 15%

Breakdown by Number of Employees:
Up to 100: 37%, 101 to 1000: 43%, Over 1000: 20%

Breakdown by Corporate Status:
Public 65%, Private 31%, Non-Profit 3%, Government 1%

Breakdown by Country:
United States 83%, Canada 4%, Australia 3%, Taiwan 3%, United Kingdom 3%, Other 4%

Authors:
Leigh Culpepper, CCP, GRP, CBP
Jeremy Greenup, CCP

Copying. If you decide to copy portions of this article into your own publication or transmission, please cite your source by including the following:

"Source: Culpepper Benefits Surveys, June 2008, www.culpepper.com"