Paid Time Off | Meaning and Definition

What is paid time off?

PTO or paid time off refers to an employee leave policy wherein a company enlists the leaves from work sanctioned to employees for which they will receive payment as well. So, to put it in layman’s terms, employees are paid during a specific period when they are away from work. Paid time off takes into account grounds like marriage, sickness, injury, bereavement, personal time, or vacation. Such leaves are available at the employee’s discretion and whenever they need them.

PTO is one of the employment benefits provided to the employees by the company. It is a great tool to attract talented folks into the organization which also promises higher employee retention and loyalty.

There are different types of paid time off such as sick leave, optional leave, military leave, vacation, jury leave, personal leave, study leave, bereavement leave, and leave to cast a vote. 

Benefits of paid time off

Who doesn’t love to relax from the overwhelming pile of office work and spend time with friends and family? Integrating an attractive paid-time-off policy helps companies hire marvelous talent, thus, emerging as robust deal makers. Not only does paid time off help employees, but it also supports employers too.

First off, paid time off reduces the chances of employee burnout which is a major culprit of low productivity and performance and negatively affects job satisfaction. Allowing short paid breaks to employees helps them rejuvenate their mojo and thus resume their duties more efficiently. Further, this helps in lowering the employee turnover rate and boosting employee morale and dedication to the role.