This question is about How PTO Works.

Floating Holiday vs PTO

Paid time off (PTO) can be used for vacation, illnesses, or personal matters while floating holidays are reserved for special events and occasions.

Paid time off and floating holidays are types of paid leave that organizations offer as part of an employee’s benefits package. They help employers remain competitive while boosting employee morale.

Let’s dive into the primary differences between the two. 

PTO refers to the number of paid days employees can request off from work and is typically used for vacation, sick days, and personal needs. These days will either be provided in full at the beginning of each year or accrued over time. 

Some companies have policies that allow employees to roll over their PTO hours into the following year, whereas others require these hours to be used annually. Unlimited PTO policies that don’t put a cap on the number of hours an employee can take off each year are also becoming more widely adopted among newer organizations.

Floating holidays, on the other hand, are a type of paid leave that can be taken for cultural holidays, celebrations, mental health days, and more. These hours are kept separate from an employee’s PTO bank and generally expire at the end of each year. Floating holidays can help companies attract diverse talent who would benefit from holidays separate from standard federal holidays like Thanksgiving, Christmas, and the Fourth of July. 

To recap, the primary differences between PTO and floating holidays are how employees utilize them and when they expire. 

Although both are considered standard benefits, there are no federal or state laws that require payment for time away from work. The number of PTO days and floating holidays a team member receives is up to the employer’s discretion and can vary widely depending on the industry and the employee’s tenure.

Floating holiday vs PTO


  • 1

    U.S. Department of Labor. “Vacation Leave.Accessed on June 11, 2023.

Accurately Track Time & Attendance With Workyard

Free for 14 days. No credit card required. Cancel anytime.

More On This