Human Resource Blog

PTO and Employee Handbook

Our company has higher rates of PTO time for different “classes” of employees, such as exempt, non-exempt and senior management. Yet the manual only has the non-exempt level in it. Is it legal to have the higher rates of paid time off without disclosing that information to all?

Yes. The employee handbook is designed only to inform a worker of the general policies that he or she must follow. It was never designed to include full disclosure of all the benefits that every employee is receiving.

Put another way: you wouldn’t publish each person’s salary in the employee handbook. Why should you publish information about each person’s PTO and other benefits?

It’s not unusual for different classes of employees to have different amounts of PTO. Many companies reason that salaried managers or executives have greater responsibilities, and therefore should have greater benefits. As long as each employee is clear on how much PTO they are entitled to, it’s not a problem.

There is no state or federal law that requires complete disclosure in any employee handbook — or even one that requires a handbook, period. Employee handbooks are widespread because HR pros realize it’s smart to have policies in writing. However, there is no requirement for one employee to be aware of the benefits that every other employee is receiving. 

It’s also not unusual for one employee in a job to have more PTO than another person with the same job. Suppose John and Susan are both salespeople. When negotiating her salary prior to employment, Susan requested an additional 2 weeks of paid vacation. The employer agreed and it is included in Susan’s offer letter. Now Susan has 4 weeks of vacation each year and John has only 2. This is absolutely legal. (It would, however, be illegal discrimination if all the women, or all the Asian employees, automatically received additional vacation time.)

If the issue is a concern when writing the employee handbook, it can always be phrased, “Hourly (or non-exempt) employees receive 40 hours of PTO after the first year and…” This implies that different rules apply to other employees. There is no need to be specific about how much PTO exempt employees and senior managers receive in the handbook. Normally this is covered in the offer letter for each position.