Top 5 PTO Tracking Mistakes Founders Make (And How to Avoid Them)

You're building a company. PTO tracking isn't exactly top of mind. You've got product to ship, customers to win, funding to raise.

So PTO gets handled informally. "Just tell me when you need time off." It works. Until it doesn't.

Here are the five most common PTO mistakes founders make, usually learned the hard way, and how to avoid them.

Mistake 1: "We'll Figure It Out As We Go"

What Happens

No written policy. No defined amounts. No formal process. Everyone just "works it out."

At 3 people, this feels liberating. At 10 people, it's chaos:

• New hires don't know how much PTO they get
• Different people have different expectations
• Requests fall through the cracks
• Resentment builds between employees who take lots of PTO and those who don't

The Real Cost

Inconsistency creates legal risk. If you approve 3 weeks for one employee and deny it for another without clear criteria, you're exposing yourself to discrimination claims.

Ambiguity breeds conflict. "I thought we had unlimited PTO" vs. "I was told 2 weeks" isn't a conversation you want to have.

Recruiting suffers. "How much PTO do you offer?" "Um, we're flexible" sounds evasive, not progressive.

The Fix

Write it down. Doesn't need to be fancy. One page covering:

• How much PTO everyone gets
• How to request it
• How it's approved
• What happens to unused days

Do this before employee #5.

Mistake 2: Approving Everything in Slack

What Happens

Someone DMs you: "Hey, can I take next Friday off?"

You reply: "Sure!"

Two months later, you have no record of this exchange. The employee thinks they have 12 days left. Your spreadsheet says 10. The Slack message is buried in thousands of other messages.

The Real Cost

No audit trail. When discrepancies arise (and they will), you can't prove what was approved.

Things fall through cracks. That Friday request? You forgot. Now two people are out the same day.

Balance tracking breaks. Every informal approval is a potential error in your tracking system.

The Fix

Create a single source of truth for PTO requests. Options:

Minimum viable: A shared document/form where all requests are logged

Better: PTO software with approval workflow

The method matters less than consistency. Every request, every time, goes through the same process.

Mistake 3: Not Tracking Balances Until It's a Problem

What Happens

You don't track balances. Or you have a spreadsheet that nobody updates. Or everyone tracks their own.

Then someone quits. You owe them payout for unused PTO. How much? Nobody knows. Cue frantic attempts to reconstruct their PTO history from calendar events, Slack messages, and memory.

Or: Someone tries to take 20 days off when they only have 15. You catch it the day before their trip.

The Real Cost

Financial liability. Many states require PTO payout on termination. Inaccurate tracking = inaccurate payouts = legal exposure.

Employee trust erodes. Nothing kills morale like telling someone their balance is wrong, especially if it's lower than they thought.

Year-end scramble. Without accurate tracking, calculating carryover is a nightmare.

The Fix

Track balances from day one. For each employee, know:

• Starting balance
• Time taken
• Current balance
• Carryover from last year (if applicable)

Update immediately when PTO is approved, not when it's taken. This prevents the "wait, I already have something approved?" problem.

Mistake 4: Ignoring State Laws

What Happens

You create a "use it or lose it" policy. Seems fair. Prevents hoarding.

Then you hire someone in California, where use-it-or-lose-it is illegal. Or Colorado. Or Montana.

Or you don't pay out unused PTO when someone leaves, because your policy says you don't have to. But state law says otherwise.

The Real Cost

Legal violations aren't cheap. Penalties, back-pay, legal fees. All for something you could have prevented with 30 minutes of research.

Per-state policies are complex. As you hire in more states, complexity multiplies.

The Fix

Before finalizing any PTO policy:

1. Check your state's requirements. Key questions:

   • Is PTO payout required on termination?
   • Are use-it-or-lose-it policies allowed?
   • Are there minimum sick leave requirements?

2. Plan for multi-state. If you have or will have remote employees in multiple states, either:

   • Create the most generous policy that complies everywhere
   • Create state-specific policies (complex but precise)

3. When in doubt, consult. An hour with an employment lawyer is cheaper than a lawsuit.

Mistake 5: Making It Too Hard to Request Time Off

What Happens

Your process:

1. Email your manager
2. CC HR
3. Fill out this form
4. Wait for both approvals
5. Update the shared calendar
6. Remind everyone in Slack

Result: People don't request PTO. They just... don't take it. Or they take it informally, bypassing the whole system, which defeats the purpose.

The Real Cost

Underutilized PTO = burnout. If the process is a hassle, people skip it. Then they burn out.

Policy becomes fiction. When the official process is ignored, you have no visibility into who's actually taking time off.

Resentment builds. Employees who follow the process feel penalized. Those who skip it feel guilty (or don't, which is worse).

The Fix

Make requesting PTO as easy as possible:

One step request: Employee submits request in one place One person approves: Usually direct manager Automatic updates: Calendar and balance update on approval

The entire process should take under 60 seconds for the employee and under 30 seconds for the approver.

If your PTO process has more than 3 steps, simplify it.

Bonus: The "Unlimited PTO" Trap

This isn't exactly a mistake, but it's a common founder decision that often backfires.

What Happens

"We offer unlimited PTO!" Sounds progressive. Attracts candidates.

Reality: People take less time off, not more. Without a defined allowance, employees:

• Fear judgment for taking "too much"
• Have no benchmark for "normal"
• End up working more than they would with defined PTO

Plus, you lose the financial liability of accrued PTO (good for your balance sheet), but gain the liability of burned-out employees (bad for your company).

The Better Approach

If you want generous PTO:

• Offer generous defined PTO (20-25 days) instead of "unlimited"
• Set minimums with unlimited: "Unlimited PTO with a 15-day minimum"
• Actually track usage even with unlimited, and address under-usage

The Common Thread

All five mistakes share a root cause: treating PTO as an afterthought.

When you don't think about PTO until there's a problem, you're always playing catch-up. The fix is simple: invest a few hours early to set up proper systems, then maintain them.

Quick Action Items

Total investment: Half a day. Cost of not doing it: Hundreds of hours and thousands of dollars in problems.

The Founder's PTO Checklist

Before you hit 10 employees:

• Written PTO policy (even just 1 page)
• Clear request process
• Balance tracking system
• State law compliance verified
• Simple, low-friction process

Before you hit 25 employees:

• PTO software (spreadsheets don't scale)
• Manager training on approvals
• Multi-state compliance (if applicable)
• Analytics on PTO usage
• Regular policy reviews

Ready to Get PTO Right?

Symple Team was built by people who made these mistakes at previous companies. We built the tool we wished we'd had: simple PTO tracking that works from day one.

Start free - takes 5 minutes to set up, prevents years of headaches.