Paid Time Off company policy examples

A well-structured Paid Time Off (PTO) policy is essential for attracting and retaining top talent. Employees value flexibility, and businesses that offer clear, fair, and generous PTO policies often see higher engagement, productivity, and job satisfaction. But what does a great PTO policy look like?

In this article, we’ll explore real-world Paid Time Off company policy examples from leading organizations and we will give you a PTO policy template.

Whether you're building a PTO policy from scratch or refining your existing one, these examples will provide inspiration and practical insights.

Let’s dive in!

What should be included in a Paid Time Off company policy?

A PTO company policy should clearly define the rules, expectations, and processes for employees taking leave. Here’s what a good PTO policy should include:

1. Eligibility & Accrual

• Who qualifies for PTO (full-time, part-time, contractors?)
• How PTO is earned (accrual system, lump sum at the start of the year, or unlimited PTO?)
• Carryover rules (Can unused PTO roll over to the next year? Any limits?)

2. Types of Paid Time Off

• Vacation Leave – General time off for rest and personal activities.
• Sick Leave – Time off for illness, medical appointments, or caring for a sick family member.
• Personal Days – Days employees can take for any reason.
• Holidays – List of company-observed holidays.
• Bereavement Leave – Time off for a death in the family.
• Parental Leave – Maternity, paternity, and adoption leave policies.
• Jury Duty & Voting Leave – If applicable in your region.

3. Request & Approval Process

• How employees should request PTO (HR software, email, Slack bot?)
• How much notice is required for different types of leave.
• Who approves PTO requests?
• Any blackout periods where PTO is restricted.

4. PTO Payout & Unused Leave

• Does the company pay out unused PTO when an employee leaves?
• If PTO rolls over, is there a maximum balance employees can accumulate?

5. Policy on Unlimited PTO (if applicable)

• How employees should use unlimited PTO responsibly.
• Any guidelines to prevent misuse.
• How managers ensure fairness and prevent burnout.

6. Legal Compliance

• Ensure compliance with local labor laws.
• Mention any required sick leave laws or government-mandated PTO.

Sample template of a Paid Time Off company policy

Here is a sample template of a PTO policy.

Note: You can always check how the policy evolves thanks to a PTO accrual calculator.

[Company Name] Paid Time Off (PTO) Policy

1. Overview

At [Company Name], we recognize the importance of work-life balance and encourage employees to take time off to rest, recharge, and take care of personal matters. This Paid Time Off (PTO) policy outlines how employees can accrue, request, and use their PTO.

2. Eligibility & Accrual

• Who is eligible: Full-time employees are eligible for PTO. Part-time employees may receive prorated PTO based on their hours.
• Accrual method: PTO is accrued at a rate of [X] hours per pay period, amounting to [X] days per year.
• Lump sum option (if applicable): Employees receive their full PTO balance at the start of the calendar year.
• Unused PTO: Employees may carry over up to [X] unused PTO days to the following year. Any remaining balance beyond this limit will be forfeited.

3. Types of Paid Time Off

Employees may use PTO for various purposes, including but not limited to:

• Vacation Leave – Time off for personal and leisure activities.
• Sick Leave – For personal illness, medical appointments, or caring for a sick family member.
• Personal Days – For personal matters that require time away from work.
• Company Holidays – The company observes [List of Holidays].
• Bereavement Leave – Up to [X] days for the loss of an immediate family member.
• Parental Leave – [X] weeks for maternity, paternity, or adoption leave.
• Jury Duty & Voting Leave – Paid time off for jury duty or voting as per local laws.

4. Request & Approval Process

• PTO requests should be submitted via [HR software, email, Slack bot] at least [X] days in advance.
• Approval is subject to business needs and team scheduling.
• Unplanned sick leave should be reported as soon as possible to a manager or HR.
• PTO may be restricted during peak business periods.

5. PTO Payout & Unused Leave

• Upon resignation or termination, unused PTO [will/will not] be paid out.
• Employees must use at least [X] PTO days per year to maintain work-life balance.

6. Unlimited PTO (If applicable)

For companies offering unlimited PTO:

• Employees are encouraged to take at least [X] days per year.
• PTO requests will be granted unless they interfere with business operations.
• Managers will ensure PTO usage is fair and reasonable across teams.

7. Legal Compliance

This policy complies with all applicable local, state, and federal labor laws regarding paid leave. If any provision of this policy conflicts with legal requirements, the company will adhere to the law.

For any questions, please contact [HR Contact Information].

23 Paid Time Off policies examples

Final Thoughts

A clear PTO policy ensures employees feel valued while keeping business operations smooth. Whether you offer accrued or unlimited PTO, setting clear guidelines helps maintain balance and productivity.

Take inspiration from these examples to create a policy that fits your team. And if you’re looking to boost employee engagement, BuddiesHR can help!