Paid Time Off (PTO) — Payroll Definition
Bank of days off that combines vacation, sick, and personal time into one bucket.
Bank of days off that combines vacation, sick, and personal time into one bucket.
PTO (Paid Time Off) is a policy that bundles vacation days, sick days, and personal days into a single bank of time. When you take a day off for any reason, it comes from the same pool. PTO is accrued — meaning you earn hours each pay period (e.g., 4 hours per biweekly period = 13 days/year). Some states require payout of unused PTO upon termination (California, Illinois, Massachusetts), while others don't. Your paystub may show a PTO balance or accrual rate.
Common pay stub code: PTO / VAC