PTO Accrual Methods - How Paid Time Off Accumulates
Understand different PTO accrual methods used by employers: hourly accrual, per pay period, annual allocation, and more. Learn which method your employer uses and how to calculate your PTO.
Hourly Accrual Method
Employees earn PTO based on hours worked. Common rate: 0.0385 hours per hour worked (equals 80 hours/year). Formula: Hours Worked × Accrual Rate = PTO Earned. Best for: Hourly employees, part-time workers, variable schedules.
Per Pay Period Accrual
Employees earn a fixed amount of PTO each pay period. Example: 3.08 hours per bi-weekly period = 80 hours/year. Formula: Annual PTO ÷ Pay Periods = PTO per Period. Best for: Salaried employees, consistent schedules.
Annual Allocation
Employees receive all PTO at the start of the year (or on anniversary date). No accrual tracking needed. May have waiting period or proration for new hires. Best for: Established employees, simple tracking.
Front-Loaded vs. Accrual
Front-loaded: All PTO available immediately (with clawback risk). Accrual-based: PTO earned over time (safer for employers). Hybrid: Partial front-load with ongoing accrual for remainder.