Is generic PTO without sick days / time normal in the US?

Question

I'm currently working for a company in Phoenix AZ, in a position that only has a specific amount of paid time off (PTO) there are no dedicated 'sick days', just PTO.

What I'm starting to realize is that this means any time I'm too sick to come into work, I'm losing a day of a future vacation, therefore pushing out the date that I would be able to take a similar-length vacation by a month (How long it takes me to re-accrue that PTO).

Many other positions I've been in recognize the concept of taking [either paid or unpaid] time off for illnesses, or to get things done that come up (Like if you have to handle a personal matter during the day, as many businesses that you have to interact are only open during the weekdays).

However, the one I'm working in right now only has PTO.

Is it common for companies to give just PTO time, and not provide employees separate amounts of time to take for sick leave?

Is this something that I should consider when evaluating how much I'm being compensated in future positions?

It seems like something that I overlooked when accepting this offer, as I feel that it's going to have an impact on how frequently I can actually take vacations.

Answer 1

In the US, companies are under no federal¹ obligation to provide any sort of paid vacation time. The concept of an employer paying you for time you're not actually working has many names and variations but these days people often use the umbrella term of "paid time-off" or PTO. The reason is that PTO often replaced the classic system of sick days and vacation days, instead giving employees a single bank of hours to draw from for any reason. But PTO has become the common term used when discussing vacation benefits, whether the system the employer uses is a real PTO system or he's just using PTO to sum up X sick days and Y vacation days.

Is is common for companies to give just PTO time, and not provide employees separate amounts of time to take for sick leave?

So yes, this is absolutely common. A PTO system has upsides and downsides, this article is a decent overview, though it seems directed at employers and biased against employees. Generally speaking a PTO program is a good thing if the amount of time provided is reasonable.

So the big question to ask in this case is whether the PTO granted is generous enough. If you're used to getting 15 vacation days and 10 sick days and you now have an offer with 20 days' PTO that may or may not be a good thing. If an employer goes from 15/10 to 15 days PTO then their employees obviously receive a net loss if they end up needing to take a sick day.

Is this something that I should consider when evaluating how much I'm being compensated in future positions?

Of course! PTO is part of your benefits package and should absolutely figure in to your evaluation of an offer! One major question that you should always ask but especially when the company uses a PTO program, is whether the company encourages people to use up their PTO. Some companies heavily discourage people from taking vacation days and sick days, despite them being part of your benefits package. The culture around taking days off is just as important as knowing how many you can take. And if you're a workaholic with an iron constitution who doesn't care about taking time off you'll want to ask whether you can get all that 'useless' PTO paid out.²

As for how to use your PTO, that's up to you. Part of the system is giving employees more responsibility in managing their own time. If you get 20 days' PTO then you shouldn't take a 4 week holiday early in the year. The reasons might be obvious to you and me but plenty of people fall into this trap and burn through their PTO, giving them no choice but to take days unpaid when they fall sick. It's a balancing act that not everyone is good at. And the risk to employees is that they end up not using PTO and are also unable to use it up in the final week(s) of the year. Whether you prefer a split system or PTO is a personal decision but typically you'll want to focus more on how much time-off you get rather than what system is being used.

I feel that it's going to have an impact on how frequently I can actually take vacations.

If you've got less combined PTO than the sum of the vacation days and sick days you used to have then yes, you can't take as many days off. You'd need to mentally subtract the number of sick days you want to keep in reserve and use the remainder as your "vacation time". But it's up to you how many days you want to keep in reserve. As mentioned it's common for people to keep five or so days in reserve and use it up during the final week(s) of the year. Some employers may allow you to carry a balance where you roll over your remaining hours to the next year. All that impacts how you can plan your time off.

---

^{1 - I'm unaware whether any states have legislation requiring a system of paid time off work. Generally though it's considered a perk and not a right, which is in sharp contrast with the rest of the developed world.}

^{2 - To be clear, you should absolutely use your time-off! The benefits of taking time away from work, especially in the form of a real vacation, have been scientifically proven many times over. A 2016 article referenced a study which found that the average American left 19 vacation days unused. That's more than most people get in a year but the median is still at 7. The US surplus for 2015 was 685 million days. Unplugging from work is essential for your mental well-being. If PTO is a part of your benefits package you should be using it.}

Answer 2

Is is common for companies to give just PTO time, and not provide employees separate amounts of time to take for sick leave?

It was exceedingly rare 25 years ago but is becoming more common.

Is this something that I should consider when evaluating how much I'm being compensated in future positions?

Yes, absolutely. While the intangibles should be considered, most of what's in a compensation package can be boiled down to a dollar value that should be used as a starting point for comparisons.*

A day off, whether it's vacation, sick time or a holiday, is a day you get paid without having to do any work for the company. That day has a dollar value, nominally eight times your hourly rate. Everything has to be looked at in aggregate, because with all other things being equal, more days off means your effective pay per hour worked goes up.

In a conventional package where your hourly rate is $50, ten days of vacation plus ten holidays is worth $8,000. Five days of sick time is worth an additional $2,000, but it's a conditional benefit because it's worth nothing if you don't use any of it. You won't know its actual value until the end of the year and you can look back at how many days you used. Figuring its worth ahead of time is a gamble on the accuracy of your estimate.

The same package in PTO-only form would give you 25 days guaranteed to be worth $10,000 because none of it is conditional. The days are all yours to use. I'll refer you to Lilianthal's answer for the practical pros and cons.

Also of note is that many conventional packages will require that you burn vacation days after running out of sick time, which is effectively the same as partially-combined PTO with financial benefits for the company. When it comes time for a payout (when you leave the company or do a time-for-cash disbursement if yours does those), the only thing on the table is your accumulated vacation time. The company has fewer dollars in potential liabilities on its books and the two weeks of sick time you've accumulated is of zero value because you won't get paid for any of it.

---

*Side note: I once worked for a company that paid a salary and funded a separate benefits account from which the cost of almost all benefits (PTO, insurance premiums, pretax co-pay reimbursement and a few other things) were drawn. Its unusual nature forced me to develop a financial model for evaluating the offers I had on the table at the time. I still use it to this day and has led to a very specific set of questions that I ask suitors when considering offers.

Answer 3

Is is common for companies to give just PTO time, and not provide employees separate amounts of time to take for sick leave?

I've worked for several companies that used PTO rather than separate vacation/sick time.

I'm not sure if it's common, but it's not all that unusual. And it's perfectly normal.

At least for me, it never became a big deal. But then I almost never take sick time anyway.

Is this something that I should consider when evaluating how much I'm being compensated in future positions?

You should consider the entire benefits package when choosing your next employer.

Answer 4

This is really just a different take on Lilienthal's answer. I may end up deleting this. But I think there is enough new information here that may help.

Is it common for companies to give just PTO time, and not provide employees separate amounts of time to take for sick leave?

Yes, this is becoming very common. The general idea from a employers perspective is that the employees no longer have to lie about getting sick. They can just take time off. Employers no longer have to keep track of why you were out. They don't need to verify sick leave with doctors etc.

For example, if you have "explosive diarrhea", there is no reason to go to the doctor. You just need to stay in bed, drink fluids, and don't go back to that sushi bar. But at the same time, no one want's you to come into work.

For more extensive medical issues FMLA takes control in the US. There are legal requirements and medical requirements. But for a simple flu, or stomach ache, cold etc. just stay home and get better.

What employers realized is the culture (there are many here in the US.) dictates different practices on when to go to the doctor, when to seek help, and what information to share with "the boss". Trying to force all cultures into one set of rules doesn't work well.

From the perspective of vacation days, many parents (for example) would take "vacation days" to take kids on field trips or school activities, etc (including doctors). They would run out, and start taking sick days. Same for singles and people without children. Run out of "time off" just take sick days. There is no way the employer can really prove that your not sick.

So, they (employers) favor combining the days. Here take 30 days a year. We don't care why. Do what you need to do.

From the employee perspective, it makes a lot of sense. Most people what to be honest, but if they have to make a decision between, using our earlier example, taking care of their kids, or lieing to their boss. Easy choice. For most employees this removes that problem.

Is this something that I should consider when evaluating how much I'm being compensated in future positions?

110% YES!!!! This is your vacation time. Rather you can reward your self by taking a 3 week vacation or a 6 week vacation is a serious consideration.

You also need to consider your other life balance issues. This "PTO" style approach allows you to take days off for what ever reason. Even if it's just spending more time with the family. Maybe you need to get your car fixed and want to take a day off to focus on that. Maybe you just want to sit around the house in your fat people pants and eat ice cream, go for it. Take a "you day" that's what it's there for. How many paid "you days" is a huge part of a benefits package.

For example a company that only gives 10 days PTO in a year. Is that even going to be enough to cover the times you get sick? Let's assume you never get sick, that's a 2 week vacation taken all at once. One sick day, or one day where you come in for the second half and use your PTO for the morning, and now you don't get a 2 week vacation. This is pretty strict.

Another example is a company that allows 60 days a year. (obviously these are polar extremes). Now you get a "free day" a week and still can take some sick time.

While they are a bit extreme, it's a good example. Which company do you want to work at. The one where every Friday is a paid day off, or the one where you never get a vacation if you catch a cold?

Other things to look for

Because your new to PTO here are some things to look for.

• Is it hours our days. I prefer hours, as a boss, I can deduct those hours if people are late. As an employee I can use those hours to cover things like going to the bank or doctor without missing an entire day. Your preference may very.
• Do you get time per year or does it add up over time. Some systems give 8 hours per 3 weeks (for example) some give 20 days per year. Make sure you understand how it adds up.
• Understand how it carries over. Some companies pay out unspent time, but this is rare. Most is "use it or loose it." Some allow for carry over.
• Be aware of what happens when your out. High turn over jobs may fire you if you start missing days not covered by PTO. Some may just not pay. Some may offer flex time of some kind. I favor (as a boss) no flex time. "You were supposed to be here at 9 why you messin' up the schedule?" as an employee flex time is awesome. A lot will depend on position an staffing but make sure you understand. (A office that is open from 9 to 5 may be more reluctant to offer flex time, a factory position that spans many shifts may love flex time if you can cover many positions)
• Be aware of how time on the job effects PTO. May old "vacation days" systems gave more vacation days the longer you were with the company. Make sure, if that's something you want, that your PTO days go up as well.

Answer 5

In the USA, it's fairly common, and it is called a "time bank". So many people use sick time as additional PTO anyway that companies have said, what the heck, and just combined it into a pool of time off, and let people deal with it.

Answer 6

I can't speak for other states but Massachusetts now has an Earned Sick Time law on the books. So sick time would be separate from vacation time.

Employers with 11 or more employees must provide paid sick time. Employers with fewer than 11 employees must provide earned sick time, but it does not need to be paid.

Earned Sick Time for Massachusetts

Answer 7

Arizona voters recently passed a proposition (Number 206) which employees will be entitled to paid sick leave. From the FAQ found at The Industrial Commission of Arizona, "Employees can begin accruing earned paid sick time at the commencement of employment or July 1, 2017, whichever is later." Also:

For employers with 15 or more employees: Employees must accrue a minimum of one hour of earned paid sick time for every 30 hours worked, but employees are not entitled to accrue or use more than 40 hours of earned paid sick time per year, unless the employer selects a higher limit.

For employers with fewer than 15 employees: Employees must accrue a minimum of one hour of earned paid sick time for every 30 hours worked, but they are not entitled to accrue or use more than 24 hours of earned paid sick time per year, unless the employer sets a higher limit.

Also, for companies that exist in multiple states:

Is an employer with employees outside of Arizona required to include those employees when calculating its total employees for earned paid sick time purposes?

...The Industrial Commission will not include an employer’s non-Arizona employees in an employer’s total employee count for earned paid sick time purposes.