Everyone needs a break from work sometimes. Burnout, poor health, and subpar job performance are just a few of the negative effects of overworking. It can also contribute to negative company culture and make it challenging to retain great talent.
That’s why it’s essential to have a solid paid time off (PTO) system in place. PTO has been proven to reduce stress and boost productivity by providing employees with the time they need to cultivate a work-life balance. It results in more collaboration, improves communication, and significantly reduces turnover.
Overall, PTO is valuable for both the employer and the employee. To take advantage of PTO, it’s important to understand how to effectively manage and track PTO. This is especially important when it comes to managing a global remote team where the line between work and home can become blurred.
Whether you have a global team or are looking into the option of global expansion, discover some helpful tips on PTO best practices.
What is PTO?
Paid time off, or PTO for short, is a benefit that many employers provide their staff regardless of whether they work remotely or in person. Paid time off is a way for employees to take the necessary time off they need for personal vacations, illness, or appointments.
Benefits of Paid Time Off
Apart from assisting in global team management, having a PTO policy in place can be very beneficial. One of the main advantages it offers employees is the flexibility and convenience of being able to take time off while being paid.
Whether your employee is taking a vacation to relax and reset or needs to take care of personal matters, PTO provides them with the convenience of being able to take time off when they need it. This allows them to take more control over their work-life balance, and can ultimately increase job satisfaction.
Having a paid time off policy isn’t just beneficial for employees. With a PTO benefit plan, you can potentially attract and retain top talent within the industry. With the competitive market that businesses operate in, potential candidates look for generous benefit packages. Offering certain periods of paid time off to employees without having any repercussions will only result in more experts wanting to become a part of a business that values its employees.
PTO can also boost your company's image. Yes, you read that correctly. By simply offering your employees the chance to take annual time off, you show potential candidates, and current hires, that you care for their well-being. This also shows your current employees that you respect their work-life balance. This is a trait that top hires and potential candidates look for in a company.
Not only does PTO improve job satisfaction and employee morale, it also prevents burnout. With the fast-paced working environment and the constant stress of meeting deadlines and completing tasks, employees often face burnout. Simply offering the option for employees to take paid time off to spend with their families and friends doing the things they enjoy can increase productivity and reduce employee turnover.
Are you more productive when you are tired and unmotivated? Or do you get higher-quality work done when you are well-rested and refreshed? Employees operate the same way. They should be allowed to take a short break when they feel overworked or burnt out. This is why paid time off is a great addition to an employee's benefits package.
Types of Paid Time Off
There are various types of PTO that you can offer your international teams.. Understanding your options will help you implement a policy that suits the needs of both you and your employees.
Accrued PTO
This policy allows employees to gradually accumulate time off. as the year goes by. Accrued PTO can also offer employees a greater amount of time off based on their years of service, helping to improve retention by allowing employees time to rest and recharge.
Bank PTO
Employees are granted a set number of vacation days that become available at the beginning of every year. Sick days, personal days and vacation days are all grouped together in Bank PTO. This policy can help improve employee work-life balance. Similar to a floating holiday, employees can pre-plan and book off days in advance.
Unlimited PTO
Employees who are covered by an unlimited PTO policy are entitled to take as many days off as they need, provided they’re completing their work and not abusing the policy.
How to Manage and Track PTO?
To get a good handle on your global teams’ PTO, it’s critical to have an organized project management system in place. An effective PTO strategy can assist in boosting employee morale, thus, making it important to spend time designing one that can be effectively managed and tracked. Management approaches for global teams looking to implement a PTO policy can vary, however, the following points are worth considering.
Have a Straightforward PTO Policy
Instituting a policy which outlines your expectations and procedures will help ensure that everyone’s on the same page. Make sure it’s easy to read and accessible for the entire team. A strong PTO policy is one that defines clear parameters, encourages transparency, and makes it easy for employees and employers alike.
Setting Clear Expectations
Be clear with your team on how much notice they need to provide when requesting PTO. Communicate how often they’re entitled to use their time off and let each team member know who is responsible for approving their time off. Clearly outlining the process for unused PTO is also good practice. Are employees paid out when upon separation? Can unused PTO roll over into the following year? All these questions should be addressed in advance.
To do this effectively, it’s important to predetermine the frequency, deadlines, and approval matrix you’ll rely on before sharing your policy with employees. Take your business’ busy periods into account when you need a stacked team. List the holidays and long weekends in each of your employees’ localities. Bear in mind that employees are more likely to want to take time off around these times, so having a system in place allowing for rotations will cover your bases.
Most importantly, stick to your deadlines and process. Only make exceptions when necessary. For example, in the case of emergencies. Doing so will help ensure each employee on your team is treated fairly and that your PTO system runs smoothly.
Rely on a Team Schedule
Organize a schedule that your team can read and understand. Share it with everyone and ensure it’s visible at all times. Depending on your team’s structure and the various groups within it, it may make sense to have multiple schedules.
Some companies decide to provide different PTO allowances and processes based on roles and hierarchy. Being mindful of the time zones your team operates in will also be necessary for global teams. Determine what suits your company best and make either a master schedule for your whole team or multiple schedules for various groups.
Within your schedule(s), clearly outline the exact dates that each team member is taking time off. Furthermore, you can detail who will be covering for them while they’re away. This will help ensure you have all your bases covered and everyone is aware of what’s expected of them.
Establish a Process for Overlapping Requests
It’s important to be prepared for conflicting requests. Determine what you’ll do if multiple employees request the PTO during the same period. One route you can take is to encourage team members to have meaningful discussions with each other. This is most applicable to those working in the same team or function in one country. They’ll be more aware of their responsibilities, local holidays, and the work that’s being done within the same time zone. Creating a strong corporate culture where team members connect and communicate with each other is one way to prevent overlapping requests for time off.
Create a Coverage Plan
It’s helpful to include coverage plans in your team schedule(s). It’s also important to carve out coverage plans before PTO requests start coming in. Anticipate future requests and figure out who will be covering for whom when time off is taken. Communicate this to each team member and ensure it works for the business, as well as for each employee.
To prevent your team from feeling overworked, organize training sessions beforehand if necessary. Make sure your employees have the support and resources they need to excel.
Encourage Clear Communication
Along with your team communicating amongst themselves, it’s important that managers facilitate communication with employees. Setting up one-on-ones to discuss PTO can help ensure employees' plans align with the team's plans and with your business needs. These team meetings also provide the opportunity to encourage employees to take advantage of their allowed PTO and to provide clarity on the policy or processes in place.
Comply with Local Laws
One of the most important things to keep in mind when managing PTO for your international team is to ensure you remain compliant with employment laws every step of the way. Provide each team member with the amount of PTO they’re legally entitled to in their country of employment.
In Canada, employees are entitled to a minimum of two weeks of paid time off. However, in the United States, there is no federal law that obligates employers to provide paid time off to their staff members.
When complying with local laws, it is also beneficial to take a look at the various cultural differences that each region or country has. Some countries may not have PTO, but it could be the norm to take days off around specific days of the year.
How Can Borderless Help?
Our easy-to-use platform and dedicated account managers are here to help you maintain compliance to the T. Whether you need to pay contractors, run payroll, hire and on-board new international employees, or manage and track invoices, our dashboard is your best friend.
We’ll ensure you comply with each country’s PTO policies, and help you manage your global team, despite cultural backgrounds, with ease. Connect with Borderless to learn more.
Speak with our team today and start implementing a PTO policy!
Disclaimer: Borderless does not provide legal services or legal advice to anyone. This includes customers, contractors, employees, partners, and the general public. We are not lawyers or paralegals. Please read our full disclaimer here.
