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PTO - Paid Time Off Setup

Overview

ProPay tracks accrued and used PTO (Paid Time Off) for each employee as an alternative to separate vacation and sick time tracking. You can configure accrual rates, maximum limits, and carryover options for your company's PTO plan.

When to Use PTO Instead of Vacation and Sick Time

Many companies now offer a combined PTO plan rather than tracking vacation and sick time separately. When you enable PTO in ProPay, the system disables separate vacation and sick accruals and tracks all paid time off under a single PTO balance.

Setting Up PTO at the Company Level

Before configuring individual employee PTO settings, you must enable PTO for the entire company:

  1. Go to Employer > Employer Setup > Screen 3 (Tax Exemptions and Benefit Accruals).
  2. Check the box PTO used instead of Vac Sick.
  3. Select the Accrual Method for your company's PTO plan from the drop-down menu.
  4. Enter the Annual Default Accrual Amount for your PTO plan.
  5. Click Save.

Important: Before switching to PTO, add any existing sick hour balances to the employee's Prior Year Vacation Hours field. This ensures employees don't lose accrued time during the transition.

PTO Accrual Methods

ProPay offers several methods for calculating PTO accruals:

Never

Select this option if the employee should not accrue PTO. No accruals are calculated by the program.

Hours Earned per Hour Worked

Employee earns a fixed number of PTO hours for every hour worked. This method is ideal for hourly employees.

Example: An employee earns 0.04 hours of PTO for each hour worked. After working 40 hours, they earn 1.6 hours of PTO.

For salaried employees: ProPay uses a standard 40-hour workweek to calculate hours worked.

Annual Hours Available

At the start of the calendar year, the system grants the employee a lump sum of PTO hours. This is sometimes called the "grant all at once" method.

Example: An employee receives 80 hours of PTO on January 1st, available immediately.

Per Paycheck

The system accrues a fixed number of PTO hours on every paycheck. The accrual amount is calculated by dividing the annual PTO hours by the number of pay periods per year.

Example: An employee who receives 80 hours of PTO annually and is paid weekly earns 1.6 hours per paycheck (80 hours ÷ 50 pay periods).

Setting Up PTO for Individual Employees

After enabling PTO at the company level, configure PTO settings for each employee:

  1. Go to Employees > Add or Change.
  2. Select the employee.
  3. Go to Screen 4 (Benefits and Accruals).
  4. Select the Accrual Method for this employee.
  5. Enter any Prior Year PTO Hours if applicable.
  6. Configure the PTO limits and options (see below).
  7. Check the box Print PTO accrual on pay stub if you want PTO balances to appear on employee pay stubs.
  8. Click Save.

PTO Configuration Options

Maximum PTO hours allowed

Enter the maximum number of hours the employee can accrue in a year. This is your PTO cap or limit.

Example: If set to 80 hours, the employee stops accruing PTO once they reach 80 hours.

Prior year accrued PTO hours

Enter any PTO hours carried over from the previous year. This field is also used when:

  • Transitioning from a previous payroll system mid-year
  • Converting from separate vacation and sick time to combined PTO

Current year accrued PTO hours

This read-only field displays PTO hours earned during the current calendar year. The system calculates this value automatically.

Current year PTO hours taken

This read-only field displays PTO hours used during the current calendar year. The system updates this value automatically when you enter PTO on payroll.

Start accruing PTO after this date

Enter the date when the employee should begin accruing PTO. This is useful for probationary periods.

Example: If an employee starts on January 1st but doesn't earn PTO until after a 90-day probation, enter April 1st as the start date.

Allow accruing over maximum hours per year

Check this box if you want to allow employees to accrue PTO beyond the annual maximum. Most companies leave this unchecked to enforce PTO caps.

Reset hours each year

Check this box to zero out unused PTO at the beginning of each calendar year. If unchecked, unused PTO hours carry over to the new year as Prior Year Accrued PTO Hours.

Add hours used to maximum hours allowed

Check this box if you want PTO usage to increase the accrual limit.

Example without this option: Maximum is 80 hours. Employee has earned 80 hours. System stops accruing.

Example with this option: Maximum is 80 hours. Employee has earned 80 hours but used 30 hours. System considers the limit to be 110 hours and continues accruing.

Print PTO accruals on pay stub

Check this box to display the employee's PTO balance on their pay stub. If unchecked, PTO balances are tracked internally but not printed on pay stubs.

Recording PTO Usage

To deduct hours from an employee's PTO balance:

  1. Go to Paychecks > Enter Payroll.
  2. Select the employee.
  3. Enter the PTO hours in the PTO or Vacation pay type field.
  4. ProPay automatically deducts the hours from the employee's PTO balance.

The PTO hours are paid at the employee's regular rate and appear on the paycheck.

Viewing PTO Balances

Individual employee balance

  1. Go to Employees > Add or Change.
  2. Select the employee.
  3. View the PTO balance on the employee profile page.

All employee balances

Run the PTO Balance Report:

  1. Go to Reports > PTO Balance Report.
  2. Choose the date range and employees to include.

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