benefit-240It’s critical to have a written policy at your company detailing how vacation and paid time off is accrued.

Many small businesses offer paid vacation, paid sick leave, paid time off or paid holidays, but have no formal policy in place. Legally, there is an implied policy, based on the company’s history of awarding paid benefits in the past, as well as any verbal or written agreements with individual employees.

Remember that if a small business owner offers a new hire two weeks more annual vacation time than other staff members, that additional time could become part of your “policy” in a lawsuit. This could result in a court deciding how much time is owed to other employees.

A business’ time-off benefit policy should be written in clear language that is easily understood by the typical employee. It is crucial to make these policies as specific as possible. In some cases, even companies with written policies have been forced to grant employees more benefits than they intended. That’s because their policies had vague or confusing formulas for determining how employees earned and accrued paid time off.

Contact Filler & Associates for more information about paid time off policies.