Employee Benefits Programs · Startups

Startup PTO and Sick leave

Colin Bester President at Bester Designs

September 14th, 2020

We are small but growing startup with 13 employees and looking to add a couple more this year and looking to add at least another 2 this year. Our employees are mix of technical, tech support, marketing and sales and are looking to formally launch PTO and sick days leave.

I do believe in the statement that prevention is better than cure but am also not a believer in unlimited days offs and am looking to learn what other 4 to 5 year old startups are doing regarding PTO and Sick leave.

My feeling is we offer traditional PTO and sick days (doctor letter required yes/no?) but in addition we discount number of PTO days taken if all days are not taken at once - this way folks can take more 2 day breaks for wellness reasons etc.

Interested to hear what others are doing.

Mechelle Timmons First time owner, employer and job creator

September 14th, 2020

We are a small business that has been in business since 2017. Our situation is a little unique because I purchased a business unit from a larger company and acquired some of its employees who expected these benefits. We went with a straight PTO policy of 80 hours per calendar year. PTO can be used as sick time, going to doctor appointments, vacation, however, they see fit. We are a small team, I would have preferred to go with a use it or lose it in a calendar year but we have several periods of high activity where we don't allow people to take time off. It is a little more work but we allow people's hours to roll over year to year with a maximum of 160 hours of accrual. We use a payroll service, so we don't carry the burden of administration. Hope that helps some!

Ayush Jain Helping Founders build team that work

September 15th, 2020

We are a IT services company with close to 100 employees.

Just to share how it has worked with us is

Upto 21 days PTO which get accumulated on a prorata basis- Every quarter 5.25 days added (We just round off to nearest number). These are meant to be used whichever way they want.

Also for people with good performance or worked an extra day are timely rewarded additional PTOs.

We use a software for managing HR department and everyone is always having a bird eye view of all leaves available.

Melissa Comenduley Caregiving visionary with operational expertise

September 14th, 2020

I am a little anxious about your comments. First, ask yourself. Did you hire your employees to do a job or to micromanage how they do it? Requiring a doctor's note is ridiculous. It says you do not believe your employees to know and do what is best for them and the team. This is not to say there won't be issues. If someone is abusing a PTO/illness policy, that requires a one-on-one conversation. Also, I agree that unlimited time off is not ideal, but not because people take too much time. If you hire the right people and treat them with respect, you will have an issue of no one taking time off, which is not a good solution. Set the policy based on how you work. If you do not take vacations and do not stay home when you are sick, you are not the example for cultivating a cohesive team. If you believe in vacation, rest, proper life balance, than create that use case. Share what you think is appropriate and why. Also, remember everyone is different and no one policy will meet everyone's needs. Be fair and flexible - offering people to take extra days off, if they work a particularly difficult project or customer account. The more you support your team to care for themselves, the more you will get in return as they care for the company and team.

Timothy Rost General Manager and Vice President R&D

September 14th, 2020

Melissa makes great points nearly echoing what I was going to say. The number one thing is to trust your employees to act like adults and make good decisions. Any behavior outside of that can be addressed as an individual matter. As for surveying what other companies do, two years ago I replaced our traditional PTO and sick plan of 13 years with unlimited because the amount of overhead to administer PTO and align with payroll just wasn't worth the hassle.

Colin Bester President at Bester Designs

September 14th, 2020

Mellisa, apologies for the downvote as I must have clicked on it when looking at phone, I don't see how to remove the down vote without doing an upvote.

Interesting the comment on micro managing and trust - which is the opposite of the truth, I don't believe in micro managing at all and all my team have lot's of latitude but at the same time I lead by example and expect just as much from all my team - this has always worked for me.

We live in a very, and in my personal opinion an, over entitled world and I have absolutely no time for entitled people, respect and rewards need to be earned.

I was not implying doctor note is required, I was enquiring whether anyone does require doctor notes - I know of several companies requiring doctor's notes if sick leave is longer than x number of days.

In my opinion, rules are in place to govern and to me to govern means to have the ability and tools in place to react if you need to. If you allow unlimited leave then how do you deal with the abusers, and at what level is it abuse - seems silly to me to "say" you have unlimited leave but over x number of days is regarded as abuse of privilege.

Timothy, also thanks for feedback, but even with unlimited PTO you still have to track leave taken so I don't understand comment on admin, but I hear you - thanks.

I do appreciate the answers and am still looking for number of days of PTO and are folks using methods to encourage spreading PTO out in smaller chunks to avoid meltdowns, are folks preferring to push longer breaks or smaller breaks - there are arguments for both sides.

I very much believe management has the authority to award days off etc as and when required (over and above defined PTO days etc) - but this doesn't negate the need to have global policies in place.

I hope this all makes sense.

Dane Madsen Organizational and Operational Strategy Consultant

September 14th, 2020

This can vary on local custom.

Thematically, however, do not over think this. Requiring a Dr.s note is very big company - not early stage. Unlimited time off is a silly notion along with free food and kombucha (and a memory, I think). Use it or lose is an aggressive "deferred salary management" strategy, but caps on accrual are normal (even Amazon has that). Separating sick days and PTO is fairly old school - you really do not care where they are if they are not there.

Being in Austin, you may be competing with benefits that will define yours to be competitive. You may be best off to find a local benefits consultant to get local guidance.

Colin Bester President at Bester Designs

September 14th, 2020

Thanks, I agree on all points. We are spread out across country so that adds another dimension. We want to be fair to all and are thinking of Sick leave so as not to effect PTO days and if they take shorter PTO (say two days) it counts for less than two days of PTO. In our current situation, taking long leave period will have impact on business and we also like idea of shorter breaks as preventative measures.

David Crooke Serial entrepreneur and CTO

September 14th, 2020

I can tell you what we did at Convio for this, T&E policy and all that stuff .... don't over think it:

1. PTO - take what you need, coordinate with your manager, be reasonable.

We set a mental target of everyone taking 4 weeks or so, in practice they took a little less. A friend, then employee, asked if it would be OK if the took 3 months at once having taken zero since he started - note that I was not his manager or VP, he was asking advice as to it being approporiate before approaching them. And I told him to go for it because it was, and to make sure he wasn't booked for that entire minor release and to arrange to do QA etc. on either end.

2. T&E - my policy as de facto CFO when we started was "spend the company's money wisely, as you would your own".

After all our salaries are coming out of the same account, so it is our own :)

This means don't stay in a mouldy dump of a motel 10 miles from the client office, but don't stay in the Lowes next door .... don't book a super expensive direct flight, but if there is one that saves you hours for $50 more then do it.

I also paid for broadband for people who were consistently working late so they could work from home, this was 1999 and a lot of people still had dialup.


This involves a lot of trust but if you can't trust your team you're doing it wrong. In practice people were careful and if anything took less time and spent less than I was hoping for, total win.

Eventually as the company grows you lose that esprit de corps and need written policies.