Banking Time

It’s a conundrum for even the savviest small-business owner: How to give employees the sick days and personal time off they need without taking a massive bite out of productivity?

One way small businesses are addressing this issue is by creating flexible leave policies. Instead of doling out a specific number of sick days, personal days, and vacation days, many are instituting paidtime-off (PTO) policies in which employees get a bank of time, that can be drawn from as sick days or personal days without having to specify.

There is a downside to PTO, however. Some argue that since an employer doesn’t know why someone is taking off, employees may be gone more frequently. The practice can also encourage sick employees to come to work because they don’t want to waste any of their flexible time on being sick, notes F. John Reh, a management consultant with Peoplearecapital.com. That’s the kind of flexibility any business can do without.

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