How to Manage PTO Policies in the Times of COVID-19

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As we quickly near the year-end, staff rushing to use their PTO may now be adding an additional financial burden that hurting businesses may have overlooked while focusing on survival through this difficult time.  

The good news is, there are various ways businesses can adjust their policies that honor highly valued employee PTO benefits, while also supporting business productivity and finances. To save you the worry, our HR Experts laid it out for you!  

Change PTO rollover rules

One option to consider is putting a pause on your use-it-or-lose-it policy and changing rollover rules to allow carryover of accrued vacation time into the coming year. If you already have a maximum carryover provision in your policy, you could increase the amount for the current year. You may also want to consider implementing vacation blackout dates to prevent employees from waiting to use their PTO until the last quarter or requesting time off during busier-than-usual periods of the year.  

[Related: How to Manage Vacation Leave Fairly and Efficiently] 

Offer PTO payout

Another option is to offer a limited PTO payout period in which employees can request to receive compensation for unused vacation time. Employees will appreciate the additional payout, especially during this time of financial hardship for many, and employers won’t be left struggling with year-end vacation scheduling and a potential loss of productivity. To make this option more financially feasible, it’s advised to set a maximum payout limit, so employees don’t request payout for years’ worth of PTO.  

Businesses that received PPP loans may use the funds to cover payroll costs such as employee vacation leave. 

Facilitate PTO donations

Though less common, some businesses also offer a leave donation policy, a creative option in which employers allow employees to use PTO balances toward cash donations to a nonprofit, aiding victims of the COVID-19 pandemic. Contributions may be deductible under section 170(c) of the Internal Revenue Code, and both employees and employers may save leave-associated employment taxes (Source).  

Encourage staggered time-off

Finally, if your employees are set on using their vacation time, or it’s not feasible for your business to implement other options, you might want to encourage them to start taking staggered time-off to keep operations running smoothly. Stress-levels during the pandemic have reached an all-time high, and stepping away from work for even a few days will allow your employees to come back refreshed. 

Need some extra coverage after all? Contact us to learn more about the ways we can support your company during the holiday rush.