There is no universal formula for offering PTO. What works for your salaried employees may fall flat with hourly field employees, and a policy that feels generous on paper can become difficult to manage if accruals, rollovers and payouts are not clearly defined.
Here are several PTO policy decisions to think through, and how other landscape companies are handling them.
Hourly Versus Salary Employees
One major variation you have to consider is how PTO is structured for your hourly and salaried employees.
Both Andy Blanchford, CEO of Blanchford Landscape Group, based in Bozeman, Montana, and Frank Murphy, president of Advantage Landscape, based in Haymarket, Virginia, opt to offer flexible PTO to their salaried employees. Blanchford says they started offering unlimited PTO four to five years ago after reading No Rules Rules by Reed Hastings.
“It sends the message that we trust our people to do their jobs without micromanaging their time off and we focus on results rather than hours worked,” Blanchford says. “In reality, they don’t seem to take more time off than when we had set PTO days. They all have responsibilities and cannot be gone for a long time. The one downside is it lacks clarity, which is not great for some team members.”
Similarly, Murphy says they haven’t had any issues with employees abusing their flexible PTO policy. He says having their time off structured this way allows team members to avoid burning out and not worry about missing out on important family events.
“If someone’s doing their job really well, communicating with their team, making sure our clients are covered when they’re off, we don’t need to micromanage their time off,” Murphy says. “We just ask if people take time off to let us know. We can’t go a month or two months off with just ‘See you later, bye.’ We have to be adults and be responsible.”
Kyle Cahill, founder of Grow and Company, based in Houston, Texas, says he has found that at the hourly level, employees are more concerned with having enough days to work and are less interested in unlimited PTO.
Murphy says they have more of a structured PTO policy for their hourly employees, but still strive to accommodate them as needed.
“If they need something, they know that their kids, their family life, is just as important as coming to work,” Murphy says.
Preventing Burnout
While it’s great to have a generous PTO policy, it does your team no good if they fail to actually take advantage of their time off to reset and recuperate. It’s a good rule of thumb to mointor PTO amounts and encourage those with high balances to take some personal time.
Cahill says their managers have proactive conversations with their team members to make sure they’re taking off regularly to prevent burnout. Murphy says he also makes a point to talk to employees who haven’t taken off after an extended period of time as a way to protect everyone’s mental health.
A recent example is when Murphy emailed salaried staff and told them to pick a day off in the next two weeks to get ready for the spring push.
PTO During Peak Season
One needle you do have to thread is managing PTO requests during the peak season, so productivity doesn’t suffer.
Blanchford says they have limits on how many employees can be off at once, and then it is up to the manager’s discretion. Murphy says they specifically have limits on their foremen taking off during the busy season, as they need drivers.
Cahill says they’ve outlined in their employee handbook that from March through June, PTO requests are heavily managed. They also communicate this expectation to candidates during the job interview so they’re aware of their busy season in advance.
“If they come to your company, and for the last 10 years, they’ve always had two weeks of vacation in April, that might not work for you,” Cahill says. “You guys need to talk about that right off the bat.”
How Is Time Earned?
Another consideration is whether you want your PTO to be something employees accrue per pay period or if it is a benefit they are given at the beginning of the year. Cahill says they just recently switched from awarding it per pay period to providing it all upfront to tenured employees.
“It’s a lot easier to manage at that point from an administrative perspective,” Cahill says. “If you’re under a year, you have to accrue it. If you’re a brand new hire, then we don’t really just give it all to you.”
Managing Liabilities
If you allow employees to roll over their PTO into the following year, it is recommended to have a set limit to how much PTO employees can accrue over a certain period of time.
“It’s extremely important to really manage in terms of what’s accrued and the liability on the books,” Cahill says. “It’s real dollars out there. It’s not made-up stuff. You do have to manage the time off and that benefit, or else it can get out of hand and can become a huge financial risk if you’re not managing it correctly.”
If you choose to allow employees to cash in their PTO, this can put your company in a particularly challenging financial situation.
“You could have 500 hours of vacation out there from management to frontline all at different rates, and if it was all cashed in at one point in time, that would be hard to fulfill,” Cahill says.
Cahill says once employees hit a month of banked PTO, they must either use some of that time or receive a payout for the hours above the threshold.
For hourly employees, Advantage Landscape allows team members to accrue a maximum of three weeks, and they must use that PTO within the calendar year. Murphy says they also allow their employees to cash out if they want to.
“Some people might want the cash,” Murphy says. “Everyone has different needs and wants.”
Meanwhile, Blanchford’s hourly employees can bank up to 100 hours, and they will lose this PTO if the balance is over two years old.
“We didn’t want it to feel like we were taking their earned benefit away, and we don’t want to force people to take PTO during our busy season,” Blanchford says.
Blanchford says he has never had employees lose PTO because they also have the option to cash out unused hours. For companies reluctant to pay out accrued PTO, he says it is worth considering whether those employees helped carry the business through the busy season and earned that compensation. If not, he says owners should examine how to make their teams more productive.
“It’s a worthwhile investment to be a people-first employer, hire the best people you can, train them, and help them make the best living you can,” Blanchford says. “You attract the best people when you do that.”
