Time Off Liability Calculator
Use this calculator to estimate the total cost of unused paid time off (PTO) for your company. With a few simple inputs, it will calculate your PTO liability in dollars.
Time Off Liability Calculator
Total PTO Liability:
$
Understanding PTO Liability
PTO Liability Definition
PTO liability is the total dollar value of all accrued but unused paid time off that your company would need to pay out if employees cashed it in.
This is important for budgeting, accounting, and financial planning, and it can include accrued vacation, sick days, or personal days depending on your company policies.
PTO Liability Formula
Total PTO Liability = Hourly pay rate × Unused PTO hours × Number of employees × PTO payout percentage
Instructions For The PTO Liability Calculator
Follow these steps to calculate PTO liability:
- Hourly pay rate ($ per hour): Enter the base hourly wage for employees. Exclude overtime and bonuses for an accurate calculation.
- Unused PTO hours per employee: Enter the total number of accrued but unused PTO hours for one employee.
- Number of employees to calculate for: Enter 1 for a single employee, or the total number of employees to calculate company-wide liability.
- PTO payout percentage (%): Enter the percentage of PTO hours that your company pays out. Typically, this is 100%.
Click “Calculate” to see the total PTO liability displayed in the green box below.
Uses For The Calculator
Why Calculate PTO Liability?
Financial Planning: Understand how much your company owes in unused PTO to ensure proper budgeting and cash flow management.
Accounting & Reporting: Accurately report PTO liability on your balance sheet in accordance with accounting standards.
HR & Policy Decisions: Evaluate company PTO policies and determine the financial impact of PTO accrual caps or payout changes.
Resource Allocation: Plan for potential payroll expenses if employees leave or cash out PTO.
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Disclaimer: This calculator is for informational purposes only and does not constitute legal, accounting, or tax advice. Always consult your HR or finance team for official calculations.
