Salary and PTO

I was recently made a salaried employee. Since I’ve been paid hourly my entire career up until now, I’m a little confused about how paid time off works. (Please don’t point and laugh if this is a stupid question. :o )

When I was hourly, it was pretty simple. If I wanted to take a week off, I could ask for a maximum of 40 hours of wages paid to me in that time. Or, I could ask to be paid my wages for what would be my normally scheduled hours.

But if I am salaried, I get my same wage no matter how many hours I work so…what exactly does PTO do? Am I just accumulating some reserve of time that it is permissible for me not to work? Like, I request a day off, eight hours are deducted from my PTO and I receive my same 2-week wage? If I ran out of PTO, would they deny me vacation or deduct from my salary?

My director was also trying to explain the advantage of “personal business.” She said that if I worked at least four hours in a day, I could take a half day off without having to pull from my PTO. I don’t quite understand where the advantage is in this. Since my work is highly flexible and 90% outside of the office, why would I need to reserve a half day off when I could just work around any personal appointment? I guess I can see one advantage in that if an emergency comes up late in the day, I can stop work without having any PTO deducted, but honestly, they are not watching me that closely because they can’t, because as I said, I am not working from an office.

I suppose you could ask them.

In my salaried position I get paid 8 hours just for walking in the door. If I’m done in 2 hours, great, I go home paid for 8. If im consistently clocking under 30 hours per week and everyone else in my position is past 40 I’ll probably get a heavier workload. When I take time off and ask to use vacation time (I can take time without pay if I want to) I burn 8 hours of vacation time per day and I still get commission for what my replacement does while I’m gone. I can also cash in my vacation time, but since I’m not actually missing work I don’t get any extra commission with it.


Typically you accrue vacation time on a weekly or monthly basis. When you take time off you keep getting paid as long as you have the time accrued. Many companies will allow you to take an advance on that time, others won’t. The time accrued is actual pay due you in the event your employment ends. Many companies limit the amount of vacation time you can accrue so you just can’t keep rolling it over year after year and building up months of vacation time. Companies also may mix together vacation days, sick days, personal days, holidays, or any other paid time off. And they may simply use fixed vacation times, like one week in July, or offer no paid vacation at all. Your employer should have a written policy spelling out the details.

Practically simultaneously with my promotion, they changed the vacation/sick time to a pooled PTO. I believe they are not going to allow us to rollover PTO, which means I better start using it as I have a ton accrued in the form of my old vacation/sick time.

Thanks, I think I understand now how salary works with PTO (it’s basically like I thought). They are going to be hold web conferences about the new policies.

You are correct that your PTO/Vacation time is used as a balance as to how many hours you can take off work and still be paid your salary. If you go negative in your PTO balance, your employer can refuse to pay you wages for the time you take off, or some employers may be willing to apply it to future time or work out another arrangement.
Also, while you are working salaried, the PTO balance does not have cash value to you, if you leave the position, they are required to pay you the remaining balance of your accrued PTO based off your ending salary ( at least they are in my state, maybe it is different in others).

It varies from employer to employer. Request a 15-minute meeting with an HR rep to clarify what your situation is.

For the two salaried positions I’ve had, there’s been a bit of variation:

One considered “vacation” time as paid time off, accrued as you work. So if your position came with 3 weeks “vacation” / year, you’d start January 1 with nothing, and by Dec 31 you’d have accrued 15 days off (paid). You could take the time off before you’d necessarily accrued it, but you weren’t (without special manager / HR approval) allowed to take time off such that you’d go into the next year with “negative” days off. On the other hand, if you didn’t take the days off, you could elect at any point to get “paid” for the days off you didn’t take. One guy I knew who was a workaholic managed to accrue something like two months vacation over many years; he picked to just have them paid out to get a nice bonus.

My current job - starting Jan 1, you have (for the 3 weeks example) 15 allowed vacation days for the year. You may use them whenever (pending manager approval.) You may not carry any over to the next year (unless you get extraordinary manager/HR approval.) And they never pay them out if unused, unless you get laid off. Any unused days at the end of the year are typically lost. The rare exceptions I’ve seen have been when certain people (typically the financial people) get slammed in December and have some of their December vacation requests denied - usually they let cases like this carry over some days into the next year. But that’s rare.

One thing that differs a bit. In many wage positions, if you take a hour or more off, you take that much PTO. Generally, in a salaried position, you dont burn any PTO until you take a half day off or more.

In other words, if you take off a hour early- as long as your work gets done- that is OK. BUT, usually they also expect you to work a hour or more extra a day during “crunch time” without any extra pay.


YMMV indeed.

Some expect you to routinely work an hour or more extra a day, and many more hours or even overnight during “crunch time” without any extra pay.

As mentioned above, pay attention to the informational sessions when they talk about rollover and payout.

My workplace counts PTO (mixed vacation/sick/holiday) by hours since we have a mix of hourly and salaried employees, but you get 8 hours at a time each time you accumulate it. You can only have 280 hours of PTO at a time, and if you have more than that, you need to use it by the end of that two-week pay period. Apparently there are provisions to pay it out to you if you don’t use it, but this is highly discouraged and rare.

When you leave you employeer they have to pay out any unused vacation time, but not unused sick time. When an employeer combines sick and vacation into PTO (paid time off) and allows you to take a set number of days off per year as PTO with no roll over then if you leave mid year they may not have to pay for unused time not taken with in the year.

In my company, it’s “Professional Time Off”. We are given 15 PTO days to use at our discretion (with manager approval), plus 10 company holiday days, and “flexible” sick time that doesn’t count against PTO. None would be paid out, and PTO days are not carried over year to year.

The basic story is that you accrue vacation days, which are yours, and can take time off up to the amount you have accrued - and maybe more depending on the company. Since vacation days accrued is a liability to the company, there is typically a cap on how much you can accrue, and you don’t get more if you hit it. As mentioned, you get paid for them if you leave. I’ve had that happen twice, and it is a tidy some.

Beyond that it depends on the company. When I started working for Western Electric, mostly manufacturing, we got two types of time off - actual vacation days and personal days. The factories shut down for several weeks in the summer and around Christmas, so most people used their vacation days for that. The personal days were for times you need to take off outside the shut down periods. In the factory you had to ask for vacation time in advance, but personal days were last minute. I worked in a research center so it was all the same, except that I didn’t get paid for personal days. When left I had made it to 4 weeks. In the Bell System vacation accrued January 1 for the next year. I left for the trivestiture on Jan. 15, so ka-ching!

Where I work now our vacation is in hours, but since we usually work well over 40 hours a week no one pays too much attention to an hour here or there for doctors visits, though there are rules about this which no one follows.
Lots of places can be more rigorous, I’ve been lucky enough to never have worked in one.

Odd. I would consider that “Paid Time Off”. What my company calls “Professional Time Off” has no fixed limits whatsoever (other than the standard 10 or so holidays). It’s whatever you can convince your manager to give you.

It’s not great, IMO. Hard workers like myself are sorta guilted into taking very little time off. Others will take off as much time as they can. I imagine that people with asshole managers get pretty screwed.

Fortunately, I can also take a half-day off without even asking as long as there isn’t too much going on. Crunch time is different, of course.

We used to have PTO like you described, and I liked it better overall. In fact, far enough back and we were able to buy back up to half our vacation days. I really liked that.

Contrary to common belief, this isn’t universally true in the U.S. Whether or not your employer must pay you for unused vacation time is a matter of state law.


When I was caught up in an equity capital leveraged takeover, I learned that companies HATE accrued PTO (vacation or sick). It hits the books as a liability and affects the ability to get loans.

My firm (needing to borrow money to pay back investors), proceeded to force us into a new ‘use it or lose it’ policy. We had a year to burn it up. Some of my co-workers had accrued lots of vacation time and had to leave work for months.