Latest PTO trends: Have employees exchange cash, retirement savings, or student loan payments
good morning!
To keep employees alive, businesses are increasing their creativity in how employees use paid leave (PTO). Instead of rolling or expiring unused days, organizations have set up programs that convert them into other funds that employees use. This includes exchanges for cash, charitable contributions, or student loan payments, 401(k), or healthcare spending accounts (HSAs).
These programs began to gain traction during the pandemic as employees donate unused PTOs to colleagues who need Goldman Sachs Ayco, a brand of Goldman Sachs Wealth Services. luck. But since then, they have expanded, allowing employees to buy, sell or exchange holidays for other uses. According to a recently released benefits, 25% of Goldman’s over 400 corporate partners now have such a PTO program from 21% in 2021. Report From the company.
“The overall trend we see now is finding flexibility in the area of benefits and compensation, including how employees use PTOs,” Wells says.
This is because workers can delegate their time in any way. This is useful when all five generations of the workforce have different needs, she adds. For example, those who graduate from long-time schools may rather spend extra days paying off their loans, or those close to retirement want to fully maximize their 401(k). Furthermore, since PTOs are traditionally pre-budgeted, persuading other executives of the potential benefits of these plans may not be a major challenge.
“Paid leave is already a budgetary expense for businesses, whether workers receive it or not, so this type of benefits won’t break banks,” says Jonathan Barber, Head of Compensation and Benefits Policy Research at Goldman Sachs Eiko.
But paying a PTO might sound like a simple solution, but it’s actually quite complicated, he points out. The administrative burden required to set up such a process manually is not easy, as HR managers need to comply with various state laws regarding what employees can and cannot do with a PTO. For example, in California, employers cannot force workers to use all PTOs on a specific date. The law requires that you take over unused vacation time.
“You can’t just do what you want to do with a PTO, because states have certain rules about what they might need to assign to employees,” Barber says. “If you agree to provide a PTO, you cannot turn it into something else without adhering to those rules to the employee.”
Large companies are likely to offer these types of programs to workers because they are likely to have established HR arms to withstand it for the exact same reasons. It said there is a surge in B2B businesses coordinated to handle such services. Anyway, he hopes more companies will adopt this approach in the future.
“I think most businesses want their employees to take leave, but when it comes to PTOs, for better or worse, we’re beginning to realize that no one takes time, whether everyone is given it or not.”
Britt Morse
brit.morse@fortune.com
This story was originally introduced Fortune.com