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What is PTO and Leave-Sharing?
An employer-sponsored leave-sharing program allows an employee to donate accrued hours of paid vacation or personal leave for the benefit of other employees who need to take more leave than they have available.
In a typical leave-sharing plan, an employee chooses to donate hours of paid leave to an employer managed “leave bank.” Generally, the employee seeking to draw from the leave bank must submit a request for approval from the employer.
PTO and Leave-Sharing Donations
Any eligible employee can donate PTO, but they must donate to an established “sharing pool” or leave bank, not to a specific colleague. By donating to pool, there is no tax implication for the donating employee.
Types of sharing pools include:
• Emergency Medical Leave - which can exist in perpetuity
• Federal Disaster or Emergency - which can exist for 18 months from date of designation
PTO and Leave-Sharing Requests
The PTO Exchange platform allows your company to customize qualifications or circumstances for employee eligibility
There are 3 steps to requesting additional PTO:
1. Complete form - including reason for request
2. Review - HR adjudicates request (approve or decline)
3. If approved, additional PTO is automatically added to employee’s PTO balance and reflected on paystub.
PTO Exchange integrates with your payroll system and simplifies the allocation of time based upon the hourly earnings rate of each employee.
Remember, the employee receiving the PTO via a sharing pool is taxed at the same rate as normal earnings.
Unused vacation doesn’t have to go to waste. With PTO Exchange, you can turn unused PTO into a strategic benefit—helping employees support their families, reduce debt, save for retirement, or simply gain peace of mind.
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