Can Different Employees Get Different PTO?

When you’re building a team for your small business, chances are, you’re hiring different types of employees. For example, let’s say you own a retail business. You might hire a staff of full-time employees to work in your corporate office doing things like marketing strategy—and then also hire a larger group of part-time employees to work the floor at your retail location.

All of those employees are important, critical parts of your team. To help them feel like a part of your organization, you want to recognize them for their contributions, ensure they have a supportive work environment, and treat all of your team members the same, regardless of their status or title.

But what about paid time off? When it comes to your PTO policy, do you have to treat all of your employees the same? Or can you offer different PTO programs (including vacation time, sick time, and personal time) to different employees?

Yes, you can offer different time off packages to different employees

When it comes to PTO, you’re legally allowed to offer different structures to different employees, as long as the basis for the different employee benefits isn’t grounded in any type of discrimination. So, in other words, you can’t create different policies based on things like race, gender, sexual orientation, religion, age, nationality, or any other characteristics protected by the U.S. Equal Employment Opportunity Commission.

That being said, if there are other ways that you group your employees—and you want to offer different paid time off packages to those groups—it’s well within your legal right to do so. Some of the different structures you may want to consider offering different types of employees include:

• Full-time vs. part-time employees. Your full-time employees work more hours than your part-time staff—so many employers offer more sick days, vacation days, and personal days to their full-time or salaried staff vs. their part-time workers.
• Tenure-based. Some companies offer increasing time off based on the amount of time an employee has been with the company. So, for example, the vacation policy for a new employee might be eight vacation days per year—but after they’re three year anniversary with the company, the next year their vacation days get bumped up to 12 days per year.
• Incentive-based. Some companies also offer additional personal days or vacation days as a bonus, incentive, or reward (for example, getting an extra day of personal time off for hitting a sales goal or after landing a promotion). This structure won’t necessarily work for every type of employee, but could be an effective motivating tool for others.
  

How to write an effective PTO policy for all of your employees and packages

If you’re going to be offering different options for different employees, it’s super important to make sure that every employee is crystal clear on the PTO they’re entitled to, including the number of days, total PTO hours, sick leave, and paid leave/unpaid leave options. And the best way to do that? 

Creating a thorough, detailed PTO policy for each program you offer.

Writing clear policies for each of the PTO options you offer—and then giving the relevant policy to the employees it applies to—can help ensure that all of your employees understand how their time off is structured, how much time off they’re entitled to, and how and when they’re eligible to take that paid time off.

Here are some things you’ll want to include in each policy:

• How vacation, sick, personal, and other time off is allocated. There are different ways you can allocate vacation days, sick days, and personal—and you want to be clear about how time off is allocated from the get-go. For example, do you offer a certain number of days off up front—or do employees accrue days off based on their work hours? If the time off is allocated on an accrual basis, what happens to accrued vacation and sick leave at the end of the year? Does the unused vacation and sick time roll over to the next year? Or does the employee get a pay out at the end of the year, with a new accrual period starting January 1?
• How much time off the employee is entitled to. The policy should also clearly state how much time off your employee is entitled to (which again, includes the number of days and PTO hours) and how that time off is broken down (including vacation time, sick time, and personal time).
• Any leave the employee is eligible for. In addition to standard time off, if your employee is eligible for any employee leave, either paid or unpaid, (like FMLA leave or other types of medical leave or sick leave), make sure to include that in your policy.
• How and when the employee can take paid time off. If your employee has to wait a certain amount of time before being eligible to take paid time off (for example, 30 days after being hired), you’ll want to include that in your policy. It’s also important to include procedures for how employees should request time off (for example, how to put in a vacation leave request or what to do if they need to call in sick).
  
  

To make sure you and your team are all on the same page with paid time off—regardless of which policy applies—make sure to have your human resources department review relevant policies with new employees during the onboarding process, answer any questions, and get them to sign a document stating that they understand the policy. 

Create policies that work for your team—whether that’s a uniform policy or different PTO for different employees

With PTO, there are options when it comes to how to structure your company policy; you can offer a blanket PTO policy that applies to all of your employees or create separate policies that apply to different types of employees, whether that’s full-time vs. part-time employees, exempt vs. non-exempt employees, or new vs. tenured employees. But the key is to choose a structure that makes sense for you, your team, and your business (and is compliant with all applicable federal laws, state laws, and local laws)—and then make sure that every employee understands the policy and how it applies to their time off.