What is paid time off and why it is important?

As a general practice, employers provide employees with a specific number of leaves to attend to their personal matters. These leaves are in addition to the mandatory leaves that the Federal holidays stipulates on an annual basis.

Most employers now club together these leaves, including personal leaves and sick leaves to create a single bank leaves. Any such leave taken will not be deducted for from the employee’s salary. And, hence it is known as paid time off (PTO). In some organisations, it may even be referred to as personal time off. The policy that lays down the particulars of the PTO is referred to as paid time off policy.

TechTarget defines Paid time off (PTO) as,

“A human resource management (HRM) policy that provides employees with a pool of bankable hours that can be used for any purpose”.

What is the purpose of paid time off?

The prime purpose of paid time off is to prevent burnout in employees. It gives employees an opportunity to unwind themselves from the regular routine. It gives them enough time to recuperate from possible burnout, recharge their physical and mental state of being to bring their best self to work again. Since the leaves are paid for, employees feel more secure and guilt-free to enjoy their time off.

But, is burnout such a serious threat to working professionals?

A 2018 Gallup study found that 23% of 7,500 full-time employees report feeling burned out at work very often or always. The triggers of burnout include unmanageable workload, time pressure and lack of role clarity.

Is burnout specific to a specific kind of employees or people?

The answer is NO. burnout is an inevitable condition that affects all levels and types of employees. It affects their productivity, work sentiments and well-being. In fact, on 28th May 2019, the World Health Organization even classified burnout as an "occupational phenomenon" that causes feelings of energy depletion or exhaustion, reduced professional efficacy and negativism towards one’s job.

The Importance Of Paid Time Off (PTO)

A paid time off policy helps reduce burnout in employees. It helps reduce the number of mistakes that employees make as a result of burnout. Additionally, it also provides several other benefits that make PTO necessary for modern players.

Here are some benefits of a paid time off policy that makes it too important to be ignored.

Ensures employee well-being

A 9-to-5 work routine leaves very few hours for employees to take care of their personal chores. A paid time off policy can give the employee sufficient time to attend to any unforeseen medical emergencies for self or for dear ones, home repairs, a sick parent, etc.

Exhibits managerial trust

PTO does not require employees to disclose why they have taken leave(s). It acts as an all-in-one opportunity that can be used any way that the employee wants, that too without taking managerial permission. This shows that the management trusts the employee to act responsibly in using their leaves. Such trust goes a long way in employee engagement.

Gives "Thinking time"

There is a popular joke that does its rounds amidst employees of all types. Most of the great ideas occur outside working hours. While this might sound absurd, most humans beings are wired to think better when they are relaxed. To put it in other words, a non-office like environ can actually make the employee think better and with clarity. That is where a paid time off policy comes into the picture.

Maximizes employee retention

Paid time off can have a dominoes effect on the employee’s personal and professional life. Since it gives them enough time to out their personal life in order, they are less burdened or stressed by the challenges at the workplace. As a result, the employee sentiments towards the job turns positive. They feel loyal to the employer and remain with the firm. Needless to says, it saves tons of cost otherwise required to hire new personnel and providing training.

Delivers work-life balance

It hurts to say, but, there is a section of the employee community that is simply scared of taking leaves. They are afraid that they will lose their jobs or be looked down upon as slacking for taking leaves. When employees put too much time into work with a hidden dissent it translates into a negative approach to work. The negative influence spills into their professional life as well. A paid time off policy helps remove that guilt of taking leaves and facilitates achieving work-life balance.

In a nutshell

Paid time off is a leave policy that allows employees to take leaves without losing the pay. It gives them enough time to attend to personal matters without being bogged down by workload or guilt of taking leaves. A PTO policy is important because it helps employees achieve work-life balance, motivates them to remain loyal and gives them enough mental space to ideate. It is for these reasons that employers are happily prepared to lay down a paid time off policy.

About the author

Jayakumar Muthusamy is a Digital marketer at Freshworks Inc. He generally writes about software that improves your marketing, sales or hiring process

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