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Paid Time Off (PTO) – Can it be shared and how best to do it?

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INQUIRY: Hey Paul, I had a quick question that I’ve been unable to find the answer for.  We have some employees that have excess PTO (Paid Time Off) at the end of the year and would like to let other employees without PTO use the time.  As a company, we generally don’t see a problem in doing that, but I wanted to see if this was okay under DCAA regulations and if there were any guidelines regarding how to do it.  If you know, can you please pass any info along?   Finance Manager

RESPONSE: Smile - another “quick question” - smile!  I don’t know off-hand a specific reference or guidance on this issue, but I do remember discussing this issue at one time.  For now consider following any “Family and Medical Leave Act (FMLA)” laws and regulations on this issue and I will let you know what I come up with as it relates to government contract accounting.

However, my initial response would be that PTO would be applied or charged according to donating employee and “How Earned” and not according to receiving employee and “How Shared/Donated”.  It is important to show all PTO according to how earned so it can be charged and tracked accurately.

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