Your employees need time off to recharge. Whether it’s paid time off or unpaid leave, time away from work is essential for work-life balance and overall employee wellbeing. However, as an employer, you probably want to know how much time your workers are taking off and verify that company policy is being followed. These time off tracking pointers can help.
The Importance of Time Off
Compared to workers in many countries, American workers don’t get much time off. According to WeForum, workers in the U.K are entitled to 28 days of annual leave. Americans aren’t entitled to any. America also has fewer public holidays than many other countries.
While a strong work ethic can be something to be admired, a lack of time off could backfire. The American Psychological Association (APA) says that burnout and stress have reached all-time highs. The APA’s 2021 Work and Well-being Survey found that 79 percent of U.S. adult workers reported experiencing work-related stress in the month before the survey. Furthermore, the majority of workers said that work-related stress resulted in negative impacts. For example, 26 percent reported a lack of interest, motivation or energy, 36 percent reported cognitive weariness and 19 percent reported a lack of effort at work.
Paid time off can help workers relax and recharge. It can also support employee retention and recruitment efforts. Employee turnover has been exceptionally high recently, leaving many employers scrambling to find enough workers. Workers who switch jobs may be looking for many things, including better pay and benefits. However, flexibility and work-life balance have emerged as key priorities for many workers. Offering paid time off is one way to provide the flexibility that workers crave.
Encouraging Use of Accrued Vacation Time
Many workers are overstressed and burned out. Some time off could help. However, even among workers with access to vacation time, this might not happen. A study from the U.S. Travel Association found that 55 percent of American workers said they did not use their allotted time off.
Workers can have many reasons for not using their accrued vacation time. They may not have money to spend on travel, or they may simply not want to deal with the hassle. However, in many cases, employees don’t take time off because they are worried that doing so would harm their career.
Employers can help by encouraging workers to use their accrued time off. Some industry leaders even recommend requiring employees to take time off. Either way, tracking employee time off is essential.
Different Types of Time Off
Time off can come in many different forms, and this can complicate time off tracking.
Some common types of employee time off include:
- Official holidays
- Floating holidays
- Sick leave
- Vacation time
- Personal days
- Paid time off that can be used for any purpose
- Unpaid leave
A Strong PTO Policy
It’s important to create a clear paid time off policy that complies with state and federal regulations and lets employees know what is allowed.
The Family and Medical Leave Act entitles eligible workers to up to 12 weeks of unpaid leave for qualifying reasons. Under federal law, employers are not generally required to provide paid time off. However, some states have laws that require paid medical and family leave. According to the National Conference of State Legislatures, 10 states have laws regarding paid family leave, and 16 states and the District of Columbia have laws regarding paid sick leave. Additionally, many employers offer paid time off even when it is not required in order to promote employee wellbeing and support recruitment and retention efforts.
The paid time off policy should be clear to all employees, and details should be readily available. This information can be included in the employee handbook and should be part of the employee onboarding process. Here are some of the paid time off policy issues that should be addressed:
- What types of time off are available?
- Which employees qualify for time off?
- When do eligible workers start accruing time off?
- How much time is accrued and how fast does it accrue?
- What can time off be used for?
- What is the process for requesting time off? How do employees make a PTO request, and how far in advance should PTO requests be made?
- What happens to paid time off that is not used? Does it rollover into the next year? Can workers receive payment for unused time when they retire? Note that state law may prohibit or restrict use-it-or-lose-it paid time off policies.
Why Businesses Need a PTO Tracker
Keeping track of time off is important for many reasons.
For many employers, the obvious reason to track time off may be that they want to make sure employees aren’t taking off (and getting paid for) time they aren’t entitled to. However, good tracking can be important for the exact opposite reason as well: to make sure that employees are taking advantage of their time off. Although this might seem like a counterintuitive goal for employers, it may actually boost productivity and employee engagement by reducing stress and burnout.
These days, some employers have started offering unlimited time off. These policies can be very attractive to workers looking for work-life balance and flexibility, and it can help simplify HR policies and administration. However, it can still be useful for your HR team to track time off. Otherwise, employers won’t know how the time off program is being used. For example, are all workers taking advantage of time off? How much time off do most workers take, and is it more or less than what would be expected in limited paid time off programs?
Tracking Paid Time Off and Unpaid Leave
Employee time off tracking can help employers manage employee absences and paid time off requests.
When tracking time off in your HR system, it’s important to include several categories:
- Time off accrued
- Time off used
- Time off remaining
If you offer multiple types of time off, you will need to create categories for each of these. When employees take time off, it’s important to make sure it’s recorded accurately in your time tracking system.
PTO Tracking Software
Some companies may use spreadsheets to track PTO. This is an inexpensive option, and it might work well for small businesses with only a few employees.
However, larger employers may be wise to invest in more sophisticated employee time off tracking software. There are multiple PTO tracking software solutions that can simply the process.
When selecting PTO tracker software, it’s important to make sure it fits the needs of your company.
- How many employees can the time tracking system support? If there is a limit and you are close to reaching it, consider what might happen if your company grows. Switching systems can be a hassle for your HR team, so it’s good to select a program that gives you room to grow.
- Can you track different types of time off? If your company has multiple categories of time off (such as paid time off, unpaid leave, floating holidays, paid sick leave and vacation days), consider whether the program lets you track each type separately.
- Does the program support paid time off scheduling and requests?
- Is the program bundled with any other HR programs?
Do you need help with time tracking pointers and other HR issues? Higginbotham HR services can help you grow your business and engage your employees. Learn more.