Employers Still Favor Traditional Paid Leave Menu, Reports Show

 

Two new surveys confirm that a majority of employers continue to offer paid leave benefits to employees through traditional plans, but a sizable portion of the surveyed organizations have opted instead for paid time off plans. 

A new report from Bloomberg BNA, Paid Leave Practices 2017, showed that six in 10 employers have traditional paid leave systems, while nearly four in 10 have PTO plans (see related blog: “New Report Supplies Insights on Paid Leave Practices”). 

Meanwhile, a survey by the International Foundation of Employee Benefit Plans yielded similar findings: 64 percent of respondents said they have traditional leave plans, and 34 percent said they have PTO plans. 

Traditional plans divide leave into categories, such as vacation, sick leave, and personal leave, and allot employees a certain amount of days or hours under each category. PTO plans forgo leave categories and roll the hours together into a combined bank of leave that employees can use for various purposes.

Leave Amounts 

The median amount of vacation leave offered by traditional leave plans during the first year of employment is 15 days, and the median amount of paid sick leave workers can expect during their first year on the job is nine days, the Bloomberg BNA report said. 

The amount of leave allotted under traditional plans increases with length of service. For example, vacation leave maxes out at a median of 26 days for long-term employees, typically after 15 years of service. Sick leave allotments often increase as well. 

Under PTO plans, workers are offered a median of 15 days of leave during the first year of employment, and the plans max out at a median of 28 paid days after 10 years of employment. Employees covered by PTO banks generally don’t receive a separate allotment of sick leave, the Bloomberg BNA report said.

Similarities on Sick Leave

The IFEB survey asked employers to specify the types of events covered by their sick leave policies. In addition to allowing sick leave usage for illnesses, many employers let employees use sick leave for medical appointments (83 percent), care of a sick child or spouse (77 percent), or disability leave (69 percent). Fewer employers have sick leave policies that cover adoptions (35 percent) or surrogate leave (24 percent).

The Bloomberg BNA report also found that a majority of employers’ sick leave policies extend beyond personal illness to cover such events as medical appointments, disability leave, and care of a family member. In addition, 37 percent of the policies encompass crime victim or safety leave, which comes into play when an employee or an employee’s family member has become a victim of domestic violence, sexual assault, or stalking.

The two reports found similarities in other areas as well. For example, both revealed that a large majority of employers offer paid bereavement leave to employees, while paid parental leave is less common. 

Leave Plan Satisfaction 

Regardless of whether employers provide leave under a traditional system or a PTO program, they appear mostly satisfied with their plans and offerings, the Bloomberg BNA report reveals. 

Among the 852 human resources professionals who participated in the survey, 70 percent indicated that their leave practices serve employees well. As further evidence of employers’ satisfaction with their current policies, just 21 percent of the surveyed HR professionals anticipate modifying their paid leave policies in the year ahead, according to the Bloomberg BNA report. And if modifications are in the works, they tend to be fairly minor revisions, such as increasing the amount of leave offered to workers or adding more leave categories. 

Just 4 percent of HR professionals said they expect to undertake a total program revision within the next 12 months.

 

 

Gain a deeper understanding of the legal complexities of employee benefits and executive compensation with a free trial to Bloomberg Law: Benefits and Executive Compensation.