PTO vs Vacation - What's the Difference?
Understand the difference between PTO and traditional vacation systems. Learn how each works, the pros and cons, and which system might be better for your situation.
What is PTO?
PTO (Paid Time Off) is a combined bank of days that can be used for any purpose—vacation, sick days, personal days, or any other reason. Employees have flexibility in how they use their time without specifying why.
What is Vacation Time?
Traditional vacation time is specifically designated for rest and relaxation. It's typically separate from sick leave, personal days, and other leave types. Each category has its own accrual and rules.
Key Differences
PTO: One combined bank, full flexibility, no need to disclose reason. Vacation: Separate from sick leave, may require justification for use, different accrual rates for each type.
Pros and Cons
PTO advantages: Flexibility, simplicity, privacy. PTO disadvantages: Sick employees may work to save days, potentially fewer total days. Vacation advantages: Protected sick time, often more total days. Vacation disadvantages: Less flexibility, must categorize absences.