When Sheryl Gagosian was rearing her children, she sometimes had to dip into vacation time to stay home with her sons when they were sick.
But three years ago her company, Placer Electric in California, converted the traditional vacation and sick time allowance into a more flexible "paid-time-off bank." Her sons are now grown, and Gagosian has more time that goes toward truly relaxing pursuits.
"Now I can just take a day off whenever I want," said the 43-year-old Gagosian.
The use of a bank for paid time off makes Placer Electric part of a small but growing group of companies that are letting employees choose when to take time off, instead of having separate allowances for sick and vacation days.
Employers around the nation are tiring of the complex accounting that goes into tracking separate sick and vacation time, so they are moving to PTO banks that give workers greater flexibility and allow businesses to better manage absenteeism.
The paid-time-off banks are especially widespread in the competitive health care industry, where staffing shortages have caused companies to search for nontraditional ways to appeal to job candidates.
In 2003, 13 percent of employers offered the paid-time-off banks, up from 8 percent in 1999, according to a survey by Hewitt Associates, a human resources firm based in Lincolnshire, Ill.
Paid-time-off banks work by combining sick, vacation and personal leave into one category of paid time off.
The practice has winners and losers: A company that offers 10 vacation and 10 sick days before converting to paid-time-off banks won't simply give employees 20 days off each year.
Instead, most take the average number of sick days that employees use (usually five) and add those to the 10 vacation days. So, under the new system, employees would be offered 15 days off.
Workers who used most of their sick days under the old system, either to take care of themselves or young kids, end up with fewer total paid days off — and less actual vacation. But those who are healthy or have few care-giving responsibilities, like Gagosian, find they have more leave days at their disposal.
Gagosian is planning a trip to Hawaii and Arizona this year, she said, and she also enjoys taking time off to spend with her 1-year-old grandson.
There's another benefit to employers: They don't have to worry about employees calling in sick when they just want a day off.
It's a significant concern at many workplaces. A 2004 CareerBuilder.com survey of 1,600 workers found that 35 percent called in sick at least once in the last year when they could have gone to work. About 10 percent said they did so three or more times.
"We used to have a lot of people all of a sudden sick on Fridays and Mondays," said Valerie Kravchenko, office manager at Citrus Heights-based Placer Electric. "It has alleviated a lot of that last-minute calling in sick. We have a better sense of when employees will be off."
Another problem with traditional sick time is that it often doesn't roll over into the next year, said Hewitt consultant Jon Van Cleve. As a result, many employees have a "use it or lose it" attitude. They tend to call in sick during November and December, often the busiest months in the business cycle, Van Cleve said.
Most companies allow their paid time off to roll over at least several months into the upcoming year.
Blue Shield of California, which introduced banks for paid time off three years ago, allows managers to veto such requests if too many people plan to be absent on the same day. The company doesn't have to get into the tricky business of determining what qualifies for vacation time, said Cathy Murphy, director of human resources.
Since the system went into effect in 1999, the company started a program for employees to donate paid time off to co-workers who are facing unexpected absences, such as a child's death. And now workers can exchange up to three days of paid time off to supplement their health care costs, an option 10 percent of employees take.