How to calculate PTO accrual per pay period
Most small teams describe PTO in days per year (“you get two weeks”) but pay people by the paycheck. Accrual is the bridge: a little time off is earned every pay period until the yearly amount is reached. Here is how to work out the number.
Step 1: turn the yearly allowance into hours
Multiply days by the hours in a normal workday. For a full-time employee on 8-hour days:
- 10 days a year = 80 hours
- 15 days a year = 120 hours
- 20 days a year = 160 hours
Tracking in hours, not days, saves trouble later when someone takes a half day or works a shorter shift.
Step 2: divide by the number of pay periods
The number of pay periods depends on how often you run payroll:
| Payroll schedule | Pay periods a year | 80 hours/year accrues | 120 hours/year accrues |
|---|---|---|---|
| Weekly | 52 | 1.54 h per week | 2.31 h per week |
| Every two weeks | 26 | 3.08 h per paycheck | 4.62 h per paycheck |
| Twice a month | 24 | 3.33 h per paycheck | 5 h per paycheck |
| Monthly | 12 | 6.67 h per month | 10 h per month |
Round to two decimal places. Over a full year the rounding can leave the total a few hundredths off the yearly number, which most employers ignore or correct with a small adjustment in December.
The other method: hours worked
Part-time and hourly teams often accrue by hours worked instead of by paycheck. The formula is the yearly PTO hours divided by the hours a full-time person works in a year (usually 2,080). For 80 hours of PTO that gives 80 ÷ 2,080 = 0.0385 hours of PTO per hour worked, which people usually describe as “one hour for every 26 hours worked.”
This method is fairer to part-time staff, but it means you need each person’s actual hours every pay period, so it only makes sense if your payroll already reports them.
A worked example
Dana starts on March 1. Your policy is 80 hours a year, paid every two weeks. Dana earns 80 ÷ 26 = 3.08 hours each payday. By the end of June, about nine paydays later, Dana has earned 9 × 3.08 = 27.72 hours. If Dana took one 8-hour day in May, the balance is 19.72 hours.
Things to decide before you start
- Does accrual start on day one, or after a waiting period like 90 days?
- Is there a cap on how much someone can carry into the next year? See our carryover policy examples.
- Can people go negative, borrowing against time they haven’t earned yet?
- What happens to unused time when someone leaves? Some states require a payout, so check your state’s rules.
Rules on accrual, caps and payouts differ by state and city, and some places require paid sick leave on their own schedule. This guide covers the arithmetic; your accountant or state labor department can confirm the rules for your location.
TeamPTOTracker tracks balances, approvals and carryover for teams of 5 to 25, and exports a CSV for payroll. Start free for up to 5 people.