Paid Time Off (PTO) is a benefit that employers provide their employees that allows them to receive payment for the time they take off work. PTO is any time an employee is getting paid while away from work—it’s more all-encompassing than “vacation.” Some examples of PTO include parental leave, jury duty, sick leave, holiday pay, or disability leave. PTO policies can be structured in many different ways depending on a given company’s size, structure, and industry. PTO policies typically bundle employees’ personal days off, sick days, and vacation time in a single block of hours rather than specifying separate numbers of days allowable for each reason. PTO banks are used to document the number of paid hours for an individual employee, and a PTO policy might include what yearly rollover (if any) is allowed and whether or not time can be taken off in lieu of overtime.

In summary, PTO is a type of paid leave that employees can take for various reasons, including vacation, illness, personal days, and more. PTO policies can vary depending on the company and may bundle different types of leave into a single block of hours.