PTO Accrual Rates Explained (Common Rates by Tenure)

Most US employers land somewhere between 10 and 20 PTO days a year, and the number usually climbs with tenure. New hires commonly start at 10 to 15 days, mid-tenure staff sit around 15 to 18, and long-timers reach 20 or more. This guide breaks down the typical rates by years of service, shows how to build a tiered policy that rewards loyalty without breaking the budget, and gives you a conversion table to turn any annual rate into a per-pay-period number.

What counts as a "normal" accrual rate

There's no federal law in the US requiring paid time off, so "normal" is set by market expectations, not statute. Across small and mid-size employers, the most common full-time starting point is two weeks (10 days) of PTO, with a large share of employers now offering three weeks (15 days) to stay competitive.

A few reference points worth knowing:

• 10 days a year is the classic baseline and still very common for year-one employees.
• 15 days a year has quietly become the new default for many office roles.
• 20 days a year (four weeks) is generous and typically reserved for senior or long-tenured staff.
• 25 days or more is rare in the US and usually signals either a senior executive or a combined PTO-plus-sick bucket.

If your policy bundles sick days and vacation into a single PTO pool, expect the headline number to be higher — somewhere around 18 to 25 days — because it's covering more ground. A combined bucket is simpler to administer and gives employees more flexibility, but it can mask whether people are actually resting versus burning vacation days on doctor visits. Keep that in mind when you compare your number against an employer who tracks vacation and sick time separately; you may be comparing very different things.

One more variable: paid holidays usually sit outside the PTO number entirely. The typical US employer recognizes around 7 to 11 paid holidays a year — New Year's Day, Memorial Day, Independence Day, Labor Day, Thanksgiving, the day after, and Christmas are the common core. When you tell a candidate "15 days of PTO," they'll often mentally add your holiday schedule on top, so it's worth stating both clearly.

Typical days per year by tenure

Tenure-based increases are the single most common way employers structure PTO. The idea is simple: the longer someone stays, the more time they earn. Here's a representative ladder that mirrors what a lot of small teams actually use.

These are ranges, not rules. A scrappy startup might start everyone at 15 days flat to compete for talent, while a tighter-margin business might hold year-one hires at 10 and reward loyalty later. The shape of the curve is up to you — what matters is that it's written down and applied consistently.

What tiered accrual actually means

A tiered (or "graduated") accrual policy is one where the rate steps up at defined service milestones. Instead of everyone earning the same amount forever, the yearly allowance increases on the employee's work anniversary.

Say you set three tiers:

1. Years 0 to 2: 10 days per year
2. Years 3 to 5: 15 days per year
3. Years 6 and beyond: 20 days per year

An employee hired on March 1, 2026 would accrue at the 10-day rate until March 1, 2029, at which point their rate jumps to 15 days. The cleanest approach is to change the rate on the anniversary date rather than waiting until the next January, because anniversary-based tiers are easier to defend as fair and simpler to automate.

Why employers use tiers

Tiered accrual does three useful things at once. It gives people a concrete reason to stay past the expensive first-year ramp-up. It keeps year-one costs predictable when turnover is highest. And it signals that loyalty is valued, which matters more for retention than a one-time signing perk. The trade-off is a bit more administrative complexity, since you're tracking multiple rates and anniversary dates — which is exactly the kind of thing software handles better than a spreadsheet.

Converting an annual rate to a per-period rate

Whatever annual number you pick, payroll needs it as a per-pay-period amount. The math is just division: take the annual days (or hours) and divide by the number of pay periods in your year.

The number of pay periods depends on your payroll frequency:

• Weekly: 52 periods
• Biweekly (every two weeks): 26 periods
• Semi-monthly (twice a month): 24 periods
• Monthly: 12 periods

Here's a full conversion table for the most common annual rates, shown in both days and hours (assuming an 8-hour workday).

Worked example. Suppose you offer 15 days a year and run biweekly payroll. That's 120 hours divided by 26 periods, or about 4.62 hours per pay period. After 13 pay periods (roughly six months) the employee has banked about 60 hours, or 7.5 days — exactly half the annual allowance, which is what you'd expect at the halfway mark.

A quick word on rounding. If you track PTO in whole days, you'll fight constant rounding errors because most per-period amounts aren't clean fractions of a day. Tracking in hours sidesteps almost all of it. You can model any rate and frequency in a few seconds with our PTO accrual calculator rather than rebuilding these formulas yourself.

Part-time and hourly staff

Tenure tables assume a full-time, 40-hour schedule. For part-timers, the fair approach is to accrue per hour worked so the benefit scales with actual hours.

The standard conversion: take the full-time annual hours and divide by 2,080 (the hours in a full-time year). For a 15-day policy, that's 120 hours divided by 2,080, which equals 0.0577 hours of PTO per hour worked. A two-week (80-hour) policy works out to the familiar 0.0385 per hour. So someone working 25 hours a week on a 15-day-equivalent policy earns about 1.44 hours of PTO each week — proportional, with no year-end true-up needed.

The per-hour method also handles irregular schedules gracefully. If a part-timer picks up extra shifts one month and fewer the next, their accrual simply tracks the hours they actually worked, so you never have to manually adjust. The one thing to confirm is what "hours worked" includes — most policies count regular and overtime hours but exclude unpaid leave. If you want a precise count of paid working days in a given stretch, the working days calculator is a fast way to check before you run the numbers.

Putting a real policy together

If you're starting from scratch, a sensible, competitive structure for a small US team looks like this:

1. Pick a starting tier. 10 to 15 days for year-one full-time employees.
2. Add one or two step-ups. A common pattern is plus-5 days at three years and another plus-5 at ten years.
3. Choose your accrual frequency. Match it to your payroll so balances update on the same cadence as paychecks.
4. Decide on a cap or rollover rule. A cap of 1.5 times the annual accrual is common and prevents unlimited banking.
5. Document the part-time method. Use a per-hour rate so it scales automatically.

Before you lock anything in, it's worth pricing it out — a few extra days per employee adds up fast across a team. Our PTO cost calculator shows the dollar value of an accrual policy, and the PTO policy generator turns your choices into clean written language you can drop into a handbook.

The short version

Start most full-time hires at 10 to 15 days, step the rate up at service milestones like three and ten years, and convert whatever annual number you choose into a per-period rate by dividing by your pay periods — 52, 26, 24, or 12. Track balances in hours to avoid rounding headaches, and use a per-hour rate for part-timers so the math scales itself.

Doing all of this by hand works until your team grows past a handful of people and a couple of tiers. SimplyPTO applies your tenure tiers automatically, accrues the right amount every pay period, and keeps every balance current without a spreadsheet in sight.