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Paid Time-Off Benefits Hold Steady During Recession
July 2009

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 2009 Culpepper Benefits Survey on paid time-off programs reveals that some companies have curtailed their paid time-off benefits in response to the economic downturn. However, most companies have protected their paid time-off benefits to help retain high-performing employees and key talent.

Key Findings

  • Approximately two-thirds of companies use a traditional paid time-off model
    with days allocated to specific categories (e.g., holiday, vacation, sick, personal).
  • Nearly one-third of companies use a PTO bank model with a pool of paid time-off days.
  • 17% of companies allow employees to cash out unused vacation and PTO days.
  • 19% of companies implemented a furlough and/or reduction-in-hours
    within the last
    twelve months.
  • 15% of companies are planning or considering a furlough and/or reduction-in-hours
    within the next six to twelve months.

Types of Paid Time-Off Models Used
Most paid time-off benefit plans in the U.S. fit into two categories (Figure 1):

  1. Traditional Paid Time-Off Models with days allocated to specific categories
    (e.g., holiday, vacation, sick/personal leave).*

  2. PTO Bank Models combining holidays, vacation, sick, and personal days into one pool, allowing employees to take time off for any reason.*

Approximately one percent of participants reported a flexible paid time-off model that allows employees to take paid vacation, sick, and personal time on an “as needed basis” without specifying a specific number of days.

* Regardless of the type of paid time-off model, many companies have separate polices for the following types of time not worked: family/medical leave, short-term disability, jury duty, testifying in court as a witness, military leave and reserve duty, sabbaticals, and voting. Legal statutes in some states require companies to pay employees for jury duty, testifying in court as a witness, and voting.

Traditional Paid Time-Off Models
Traditional paid-time off models typically take one of two forms:

  1. Traditional Paid Time-Off Model with a specified number of sick & personal days
    About four-out-of-five companies define a specific number of paid sick and personal days that may be taken each year (Table 1).

  2. Traditional Paid Time-Off Model without a specified number of sick & personal days
    Approximately one-fifth of companies do not define a specific number of paid sick and personal days that may be taken each year (Table 1). Instead, most of these companies describe having flexible sick and personal leave policies that allow employees to take paid sick and/or personal time-off off on an as needed basis.

Table 1:
Average Number of Days of Paid Time-Off for Traditional Models
Avg # Sick & Personal  Days Avg # Holidays Avg # Vacation Days by Number of Years of Employment
Designated 
Floating 
1 Year 3 Years 5 Years 10 Years 15 Years 20 Years
With specified number of Sick & Personal Days
7.6 8.9 1.2 11.5 12.8 15.7 18.7 20.3 21.1
Without specified number of Sick & Personal Days
n/a 9.0 1.1 14.2 14.7 17.5 19.6 21.3 21.6
* Additional statistical metrics and data cuts are available in the comprehensive version of this report.

PTO Bank Models
PTO bank models combine holidays, vacation, sick, and personal days into one pool, allowing employees to take time off for any reason (Table 2). Nearly one-third of companies with paid time-off benefits use a PTO bank model.

Table 2:
PTO Bank Model with Pool of Paid Time-Off Days
Average # Days in PTO Pool
by Number of Years of Employment
1 Year 3 Years 5 Years 10 Years 15 Years 20 Years
17.3 18.6 21.5 24.7 25.4 25.9
* Additional statistical metrics and data cuts are available in the comprehensive version of this report.


Other Paid Time-Off Practices & Policies
In addition to the data table and figure above, we provide a more comprehensive report with additional information and data tables covering the following: 

  • Number of Paid Time-Off Days

  • Eligibility to Receive Paid Time-Off Benefits

  • Paid Time-Off Provided to Part-Time Employees

  • Eligibility to Take Paid Time-Off

  • Paid Time-Off Accrual Schedules

  • Treatment of Unused Vacation and PTO Days
    (Accrual Maximums, Carry Forward/Roll Over, and Cash Out Practices & Policies)

  • Mini-Vacations

  • Donating, Buying, and Selling of Vacation and PTO Days

  • Unlimited Paid Leave Plans

  • Sabbaticals & Extended Leave Programs

Demographic data cuts include:

  • Number of Employees (1 to 100, 101 to 500, 501 to 2,500, Over 2,500)

  • Industry Sector (Technology, Life Sciences)

  • Ownership (Public, Private, Non-Profit)

Availability of Comprehensive Report as Downloadable PDF

  • Free to participants in 2009 Paid Time-Off Practices & Policies Survey

  • Free to subscribers of Culpepper Benefits Survey Package
    (includes Culpepper Library and Small Company Plus subscribers)

  • $295 for non-participants and non-subscribers (Order Form)


 

Data Source: Culpepper Benefits Survey of 182 organizations.
Survey Dates: April 13 through June 9, 2009

Breakdown by Sector:
Technology 60%, Life Sciences 14%, Other 26%

Participant Breakdown by Number of Employees:
Up to 100: 30%, 101 to  500: 29%, 501 to 2,500: 25%, Over 2,500: 15%

Participant Breakdown by Ownership/Corporate Status:
Public 32%, Private 58%, Non-Profit 6%, Government 2%

 

Participant Breakdown by Country:
United States 98%, Canada 2%

 

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