SOURCE: Alexander Hamilton Institute

October 11, 2006 12:53 ET

Growth of Paid Time Off Programs Hits Plateau

RAMSEY, NJ -- (MARKET WIRE) -- October 11, 2006 -- According to the 2006 annual survey by the Alexander Hamilton Institute, the number of organizations utilizing a paid time off (PTO) leave program has stopped growing, despite the fact that PTO programs have been shown to reduce unscheduled absenteeism.

Fifty-six percent of the over 800 organizations responding to the survey still use a traditional leave policy that separates and tracks vacation, personal, and sick leave, as opposed to using PTO programs -- the same percentage as in 2005. In a PTO program, most organizations combine vacation, sick, and personal leave into one bank.

Respondents who have instituted PTO lauded the results, with 56% claiming they had reduced unscheduled absences, and 89% stating that their switch to PTO had met or exceeded their expectations.

Among the other benefits of PTO programs pinpointed by users were easier record-keeping for accrual, eligibility and usage; less confusion among employees about time off schedules; and better recruiting and retention strategies.

Respondents sticking to their traditional time off programs cited the costs involved in switching to PTO and paying for accumulated sick leave, record-keeping changes, and tracking sick time for legal reasons.

Survey data helps firms combat turnover

One major goal of the survey is to give organizations a way to benchmark how their leave programs -- whether PTO or traditional -- compare to those of other employers. That comparison is critical today for retention of top employees and lowering or turnover rates, especially in light of the fact that departing employees often cite leave policies due to quality of life issues as a reason for their decision to leave.

Copies of the Report that contains both the results of the survey as well as a guide for converting to a PTO program are available at:

Alexander Hamilton Institute provides employment law information to Human Resources professionals, Personnel managers, front-line managers and supervisors, and top management in a variety of formats including newsletters, loose-leaf manuals, CDs, booklets, audio conferences, and webinars.

For more information about the survey, contact: Melissa Pomerantz at 201-825-3377, ext. 110.

Contact Information

  • For more information about the survey, contact:
    Melissa Pomerantz
    201-825-3377, ext. 110