8 Tips for Managing Employee Paid Time-Off Requests

While 61% of overworked employees report dangerous levels of burnout, according to the 2025 SHRM State of the Workplace Report, time-off requests can improve productivity; employees with a good work-life balance outperform burned-out ones.

Establishing clear strategies for managing paid time off can turn vacation requests from workflow disruptions into a competitive advantage despite the potential challenge of meeting operational deadlines and coordinating team efforts. Let's explore some practical approaches to a PTO management system while maintaining a smooth workflow.

How To Manage Employees' Time-Off Requests

Managing employee paid time off is more than just saying "yes" or "no" to requests. It's about creating a supportive work environment where employees feel valued and motivated while maintaining business operations. According to Amanda Gee, Talent Enablement Partner at Paychex, “approving or denying paid time off (PTO) is primarily an administrative task that involves reviewing calendars and staffing levels to ensure adequate coverage and maintain productivity. However, leaders who go beyond this basic function by actively promoting flexibility, autonomy, and employee well-being help cultivate a culture of work-life balance and create a more positive employee experience.”

Let's dive into some strategies and tips to help you manage time-off expectations while keeping operations on track.

1. Plan Far in Advance

Frequently employees already know when they'll need vacation days, personal time, or family leave. If they don't communicate early, it puts unnecessary strain on your workflow. When you encourage staff to submit their paid time-off requests early, you gain the lead time to align schedules, prevent staffing gaps, and keep operations running smoothly.

Start by establishing a framework that encourages employees to request time off well in advance, with exceptions for emergencies. Getting ahead of employee leave requests helps ensure better coverage when an employee is out and minimizes business disruptions during periods of high demand.

2. Have a Clear, Documented PTO Policy

A well-documented and transparent PTO policy is crucial for successfully managing employee time-off requests. Ensure you communicate your policy during new employee orientation and include it in the employee handbook.

Make sure your policy for handling time off requests clarifies the following questions:

• How much time off does the company provide?
• Who is eligible for time off?
• When can employees take their time off?
• How far in advance must employees submit requests?
• Who must approve the requests?
• Which busy periods may restrict time-off availability?
• Is accrued but unused paid time off (PTO) paid out upon termination of employment?

Set clear expectations around your company's staffing needs and make sure everyone understands the policies and approval process. When necessary, have employees inform you which holidays they are willing to work versus which ones they prefer to have off.

For example, in a healthcare setting, the need for medical care does not pause for holidays. Patients and residents require continuous care, making it critical to manage staffing levels effectively. An assisted living facility might ask nurses and caregivers to indicate their preferred holidays off and be willing to compromise on others. Offering extra pay for holiday work further incentivizes employees to cover these important shifts, ensuring necessary staffing levels are maintained.

This approach ensures that essential services are maintained while respecting employees' preferences for time off. Clear communication and a well-organized PTO policy can strike a balance between the need for continuous business operations and staff well-being, creating a supportive and efficient work environment.

By clarifying your company policies upfront, you create a system everyone understands.

3. Create a Uniform Way for Employees To Submit Time-Off Requests

Standardizing how employees ask for time off keeps things organized and makes scheduling easier for everyone involved.

Use Written Documentation

Require employees to complete a time-off request form. Instead of forms, consider using email requests, a shared calendar, or a centralized technology tool to track and manage time-off requests. Verbal approvals can create problems you don't want, like forgotten conversations, disputed dates, and potential legal issues. Written requests help protect both you and your employees.

Essential Information

A typical time-off request form should include:

• Employee name and department
• Requested dates
• Employee and manager signatures

Optional Details

Consider adding space for the reason behind the request. If two employees want the same dates, context helps you make fair decisions when managing time off.

Approval Process

The form should include a section where managers can approve or decline requests, plus space for comments. This creates a clear paper trail and helps explain decisions.

This uniform approach can minimize misunderstandings before they start and gives you a defensible process for managing PTO requests.

4. Post a Calendar for Everyone To See

A shared, up-to-date employee time-off request calendar can help alleviate the most common source of employee frustration: overlapping vacation time requests. It also helps identify when recruiting and hiring additional seasonal help may be necessary.

Post this calendar where everyone can see it, either in a common area or online. When employees know which dates are already taken, they may naturally adjust their own requests.

Additionally, having a visible calendar encourages employees to plan their PTO requests early, fostering a culture of proactive workforce planning. It also allows managers to spot patterns in leave requests, enabling better preparation for peak times. As a result, your employees may feel informed and respected, your scheduling runs smoother, and you spend less time mediating time-off disputes.

5. Develop Coverage Strategies for Different Jobs

Not all roles within your business have equal flexibility when it comes to scheduling. Some positions require specific coverage strategies during an employee's absence because they have specialized knowledge or established client relationships that other employees can't easily replicate.

To help you handle requests where a key employee takes time off, identify the tasks they handle and assign someone to cover them. It helps to create a clear handover plan that includes:

• A description of current projects in the works
• Overall job responsibilities
• Essential contact information for individuals the key employee has been working with
• A detailed checklist of ongoing tasks

Train backup staff thoroughly and assign a point of contact for questions. You can't plan for every situation, but it's helpful to consider some common scenarios that may arise and outline potential solutions. This way, operations continue smoothly without significant interruptions, business continuity continues, and employees taking time off have peace of mind.

6. Offer Incentives To Cover Busy Periods

Many employers offer incentives or premium pay to employees who agree to work during periods of high demand. Offering a small bonus or higher hourly rate during a busy period may encourage employees to save their paid time off for slower periods when you can better spare them. However, as Gee points out, “It is important to consider how these incentives and premium pay may impact overtime pay for non-exempt employees.”

Ask your staff what employee benefits they'd value most, such as gift cards to popular restaurants, extra time off to use during quieter periods, or additional pay during busy times. Different people want different things. Tailoring incentives to what your employees truly value helps ensure that they feel heard and appreciated, which can lead to increased job satisfaction and loyalty.

Focus your incentives on the most critical parts of the calendar year. When you make working during peak season genuinely attractive, employees may be more willing to work instead of requesting time off.

This approach to managing employee time-off requests benefits everyone. You get coverage when you need it most, and employees earn extra compensation or perks when they work the hardest. Plus, engaging your team in this dialogue helps you understand their needs and fosters a sense of community and mutual respect.

7. Accept That You Can't Please Everyone

You can't always grant every paid time-off request, but you can manage how employees react to being told no.

For instance, if multiple employees want the same popular holidays off — like the Fourth of July — compromises may be necessary to keep the business running smoothly. You need clear PTO policies that are organized, fair, and compliant with federal, state, and local laws. It helps you balance employee needs with business priorities while reducing resentment when requests overlap.

To tackle the question of how to manage time-off requests fairly, consider these methods:

• First come, first served: Approve requests in the order they are received. This rewards early planning and is simple to understand and manage.
• Seniority: Give preference to employees with longer tenure, especially for high-demand holidays. Just be mindful that newer staff members may see it as unfair.
• Rotation system: Rotate popular holidays year to year, so everyone eventually gets their turn at time off during peak times.

Choose one system, communicate it clearly, and apply it consistently. This transparency shows your team you're working to be fair, not arbitrary, which builds trust even in disappointing situations.

8. Leverage Time Tracking Solutions To Manage PTO

Managing employee vacation requests on spreadsheets and sticky notes can create unnecessary problems. Time-tracking technology automates the tedious parts of PTO management, freeing you to focus on running your business.

These systems track attendance and employee availability, manage paid time-off requests, and help ensure compliance with labor laws and regulations. You won't have to calculate remaining PTO balances by hand or worry about approving too many people for the same week.

The real value comes from seeing workforce patterns you might otherwise miss. You'll spot peak periods that require additional coverage, allowing you to plan accordingly and avoid last-minute scrambles for coverage.

Additionally, features like automated reminders and real-time updates let you streamline communication and minimize misunderstandings. Your employees get faster responses to their requests, and you get a system that works without constant attention.

<div>“Employees value the ability to manage their schedules independently, take time off to recharge, and work flexible hours that accommodate their personal needs. Just as important, they want to see that their leaders genuinely support these values, not just in words but through consistent actions.” </div> Amanda Gee | Talent Enablement Partner at Paychex

How To Keep Track of PTO

Staying organized is critical to meeting employee needs and ensuring business operations run smoothly. Poor PTO tracking costs you more than time — it costs employee trust. When requests get lost, balances are wrong, or approvals are delayed, your team notices.

Businesses can use several methods to track paid time off, each with its own benefits. The simplest method is through paper requests, where employees manually fill out PTO request forms and submit them for approval. While this can work for smaller teams, it often leads to clutter and disorganization over time and can be especially challenging for businesses with hybrid or remote workers.

Another common method to track PTO is through email. Employees can submit their PTO requests directly to their manager, making it easy to keep a record of all requests. However, searching through emails can be tedious and might result in missed or forgotten requests.

Spreadsheets can also be an effective solution to PTO tracking. Teams can easily track requests, approvals, and remaining PTO balances by creating a shared document. This option offers a bit more workplace flexibility and can be customized to fit the team's specific needs, though it requires regular updates to maintain accuracy.

Finally, investing in time-tracking or HR software can significantly streamline the entire process of managing employee PTO. These platforms automate the tracking of vacation requests and PTO accrual, provide real-time updates, and often include features for compliance and reporting. While this may involve upfront costs, their efficiency and accuracy can save time and reduce stress in the long run.

Here's an overview of different tracking methods to help you evaluate your options:

HR best practices for your company depend on your team's size, budget, and need for visibility. For small teams, spreadsheets or email may be sufficient. But as your business grows, adopting software can bring much-needed efficiency and reduce the risk of missed or overlapping time off.

Still Need Help Managing Time-Off Requests?

Every business depends on its employees' talent, morale, and productivity. Implementation is the difference between businesses that struggle to manage PTO and those that grow confidently. By planning ahead, creating clear policies, and fostering open communication, you can create a system that meets the needs of both your employees and your business.

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