Guide

How to Calculate PTO Accrual

By Muhammad Wajih Ul Hassan, Lead Developer & Software Engineer · Updated October 1, 2026

PTO accrual is paid time off you earn gradually as you work, rather than all at once. The usual formula is annual PTO hours ÷ annual hours worked, which gives an accrual rate per hour worked. Two weeks (80 hours) a year on a 2,080-hour full-time schedule accrues at 80 ÷ 2,080 = 0.0385 hours for every hour you work, or about 3.08 hours per two-week pay period.

The two common methods

1. Per hour worked

accrual rate = annual PTO hours ÷ annual scheduled hours
PTO earned = hours worked × accrual rate

This method suits hourly and part-time staff, because PTO follows the hours you actually work. A week of overtime earns a bit more (if your policy counts overtime hours), and a short week earns less.

2. Per pay period

PTO per pay period = annual PTO hours ÷ pay periods per year

Common for salaried staff: the same amount is added every paycheck regardless of hours. For 80 hours a year, that's 1.54 hours a week, 3.08 biweekly, 3.33 semimonthly or 6.67 monthly.

Accrual rates at a glance

For a full-time schedule of 40 hours a week (2,080 hours a year):

PTO per year	Per hour worked	Per biweekly period (80 h)
40 hours (1 week)	0.0192	1.54 hours
80 hours (2 weeks)	0.0385	3.08 hours
120 hours (3 weeks)	0.0577	4.62 hours
160 hours (4 weeks)	0.0769	6.15 hours

Keep at least four decimal places in the rate. Rounding 0.03846 to 0.04 looks harmless, but over 2,080 hours it gives 83.2 hours instead of 80.

Worked examples

Part-time. An employee on the 80-hour plan works 25 hours a week. Using the per-hour method: 25 × 52 = 1,300 hours a year × 0.0385 = 50 hours of PTO a year, the same share of their schedule as a full-timer's 80 hours.

What it's worth. At $22.00 an hour, a full year's 80 hours of PTO is worth 80 × $22.00 = $1,760. That's also the gap between your hourly rate and your effective rate if you compare a job with PTO against one without; the Salary to Hourly Calculator can adjust for it.

Accrual caps. Many policies cap your balance, for example at 1.5 times the annual amount (120 hours on an 80-hour plan). Once you reach the cap you stop accruing until you use some PTO, so time you could have earned is lost. Taking leave regularly keeps the accrual running.

What the law requires

United States

Federal law doesn't require paid vacation, sick leave or holidays: the Fair Labor Standards Act "does not require payment for time not worked". PTO is a matter of employer policy or contract, plus state and local law. Some states and cities require paid sick leave, and rules differ on what happens to unused PTO when you leave. In California, vested vacation can't be forfeited: Labor Code §227.3 says unused vested vacation must be paid out at your final rate when employment ends. That rules out "use it or lose it" policies, though employers can stop further accrual with a reasonable cap.

United Kingdom

Almost all workers are entitled to 5.6 weeks' paid holiday a year, which is 28 days for someone working five days a week (the statutory maximum is 28 days). Part-timers get 5.6 times their working days per week: 3 days a week gives 16.8 days. In the first year of employment, holiday can accrue at one-twelfth of the annual entitlement each month. For irregular-hours and part-year workers, in leave years starting on or after 1 April 2024, holiday accrues at 12.07% of hours worked in each pay period: 30 hours worked earns 3.62 hours of holiday.

Canada (Ontario)

Ontario's Employment Standards Act gives at least two weeks of vacation time per year, rising to three weeks after five years. Vacation pay is a percentage of gross wages: at least 4%, or 6% after five years. On $50,000 of gross wages, 4% vacation pay is $2,000.

Australia

The National Employment Standards give full-time and part-time employees four weeks of paid annual leave a year, accruing progressively based on ordinary hours worked. A full-time employee on 38 ordinary hours a week earns 152 hours a year, or 1 hour for every 13 ordinary hours (0.0769 per hour). Some shift workers get five weeks. Casual employees don't get paid annual leave; they receive a casual loading instead.

Questions to ask about your PTO policy

Does accrual count hours worked or hours paid? (Paid includes holidays and PTO itself.)
Do overtime hours earn PTO?
Is there a cap on the balance, and what happens at the cap?
Can you use PTO before it's accrued, or only after?
Is unused PTO paid out when you leave? (In some states it must be.)

Calculate it

Use the working-hours calculator on the Hours Worked page to see your annual hours before and after PTO and holidays. The Salary to Hourly Calculator shows how PTO changes your real hourly rate. For background on annual hours, see how many work hours are in a year?