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Top Guidelines for Creating a Paid Sick Leave Policy

Top Guidelines for Creating a Paid Sick Leave Policy


The Ideal Paid Sick Leave Policy

It’s been known that nationally paid sick leave is growing, and the trend seems to continue. Smart employers have noted that employee productivity is greatly increased when their personnel know that they can take off a certain amount of time they need.

What is a paid sick leave?

An Overview of PTO (Paid Time Off)

Paid sick leave is also known as PTO or Personal Time Off, and basically it’s the hours that an employer gives to its employees for sick days, including paid days the employee can take off within a given year.

Companies have been facing the need to create a paid sick-leave guideline. They are discovering that, in fact, by implementing a proper structure, a paid sick leave can mutually benefit the company and the employee, as employees on paid sick leave become more productive upon their return.

Before putting into place their leave policy, an employer should take into consideration their own business needs and when setting guidelines for their employees’ sick leave policy, they should determine if it is best to have a single vacation and sick day absence policy, or to custom tailor the time-off per situation and case.


Single PTO

Single PTO verses per Case Policy

It has been recorded that the majority of employees do not use their sick leave and try to save it for the future when they really need it most. Also, policing employees is a hard thing to do, as employees like to have the flexibility to select when they need to take time off from the work they enjoy. Therefore, looking at it from the standpoint of just manpower, if the sick leave policy is done on a per case basis, employees will take less time off, than if the company has an umbrella general policy regarding time off.

The “Ideal Policy” should separate the benefits of the sick paid leave policy by type, all while including:

  1. A way to track the build-up towards the leave
  2. A method for employees to ask for an anticipated leave
  3. The right of the employer to ask for a type of medical documentation
  4. A procedure to audit the employee and to prevent and discover sick leave abuse


Many companies have been starting to integrate their PTO, vacation and sick leave policies into bundles. Paid leave does not obligate the employer to pay the accrued and unused sick leave when an employee is terminated, although they most probably will have to pay out the accrued vacation time.

It seems that some business lawyers have also advised their clients that un-bundling “leave benefits” may be a better option, since the company will then not have to pay for unnecessary, unused sick and PTO time to the employee they are dismissing. Many companies have been separating the sick leave from the vacation time leave in their guidelines, so they will know exactly how much they will owe their employee when they depart from the company.


Bundled Benefits

Bundled Benefits

What happens to those employees who are used to bundled benefits and want that type of benefit?
The lawyers recommend making it a “clear leave policy” by stating in the guidelines that PTO, vacation and sick leave come out from the same place; the entire company budget. The employee must be notified that every day they use for a sick day leave, they will be deducting that from their paid vacation time. That way they will use their paid sick leave wisely and with more thought put into it.

Absenteeism Abuse

The issue some companies are dealing with more and more is absenteeism taking place in order to simply get a paid day off! That is why it’s important for business owners to start requesting their staff for a note from the doctor or be advised of foreseeable sick leaves ahead of time.

  • Employees who are thought of abusing the PTO should be monitored and their actions documented.
  • Some corporations have started paying sick-leave for part-time and temporary employees.
  • Some employers, such as restaurant owners, need not concern themselves too much with abuse of absenteeism, as a “tipped” worker is less likely to call in sick.


Benefits of Paid Sick Leave

Benefits of Paid Sick Leave

Many employers found that employees feel great about their job and themselves if they have better control over their work time. In turn there is less abuse of sick leave; enthusiastic employees who are energetic at work, are pleasant on the job, likable by the customers they serve, and totally beneficial for the companies they work for.

Successful companies integrate the suggestions and feedback from their human resources and staff when coming up with thriving paid sick leaves. Policies and plans that work really well for their firm or corporation are put into place and the workers needs are implemented into the guidelines; it’s a win-win for everyone involved.



Article provided by Neches FCU, an Equal Employment Opportunity Employer.
Neches FCU is one of the most trusted Texas credit unions. Their superior team of professionals are famous for providing top notch service to its 45,000+ members. They are well-known for a positive work atmosphere, where all clients are known by name.

Recent Hiring Increases Show Small Business Optimism Is Returning

Small Business Optimism Returning With Hiring

As has been the case with most recoveries, it is small and medium size businesses who have seen the effects of an improving economy the fastest. While large corporations may have the fortitude to last through long economic winters, it’s the smaller businesses that have been nimble enough to take advantage of rising consumer sentiment and spending.


Business Optimism

Business Optimism

The 2009 Recession may seem like a bad nightmare from a few years ago, but it’s effects were felt for at least three to four years after the downturn started. Since that time small business performance and sales have been picking up again as more people are getting hired and finding work. That in turn creates more disposable income, which produces an increase in sales and revenue, particularly for small businesses looking to grow again.

Optimism is Back

Small businesses reflected their highest optimism in eight years at the beginning of 2015, showing a big restoration of their outlook when it comes to expected sales production. The dark clouds are finally beginning to dissipate as the most sensitive portion of the economy is forecasting a positive year for their industry niches. And even more convincing that small business was really moving forward again was the fact that the same statistics at year start included the highest level of hiring seen in eight years as well.


Positivity returns

Positivity returns

Are things out of the woods? Not quite. Global growth and competition remain big factors, especially for small businesses that see a lot of their revenue from international sales versus domestic figures. However, the general trend and fundamentals are clearly moving in a positive direction regardless of overseas issues.

Statistics Supporting Recovery

The small business portion of the economy is not chump change either. Despite the fact that large corporations may have thousands of people, it is small business that consistently makes more than 50 percent of production and they have the single biggest block of hiring in the economy as well combined. In many of the most current measurements, the metrics are pointing to the fact that the small business sector has returned to pre-recession performance levels, including the ability to start thinking about capital investment and similar large growth activities.


Economic recovery

Economic recovery

Even the federal Labor Department is getting in on the act of reporting the positive, which is a final convincing point that the Recession has ended for small business. The federal agency put out a 2.9 percent increase in small business hiring, its highest level since 2001. When even the feds have decided to confirm economic optimism, the trends become clear for even the most pessimistic of critics that the worst is over.

Shrinking Applicant Pool


shrinking numbers

shrinking numbers

The Job Openings and Labor Turnover Survey (JOLTS) have shown another closely watched document tracking hiring and how it affects money management policy. This report is particularly important and monitored by the top leaders in the central banks, including the Federal Reserve Chair, Janet Yellen, when crafting new monetary policy going forward. The latest JOLTS report not only confirmed a strong hiring trend definitely in place, it also predicted a speeding up or acceleration of hiring this year as well.

The job market it tightening up and its started to move in the favor of the job applicant with the number of openings being created, specifically down to 1.82 persons per job opening. This is probably the lowest the availability ratio from JOLTS has been in almost a decade. Most economists see this performance as an elimination of slack in the job market, preparing the stage for clear competition among employers.

Reports Not Needed


No Reporting

No Reporting

However, the real proof of optimism is in the job managers and company owners of small businesses themselves. They don’t need a government report to tell them what they already know. Their businesses need qualified help and right away. The news is probably the best thing that could hit the market, particularly for young people coming out of college after years of graduates facing nothing except delinquent student loans. The ability to actually get hired and get established will have a big ripple effect across generations, and most of it will be driven by small businesses needing fast growth and fast staffing up to meet new demands.


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