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Paid vacation is a benefit offered to employees that may be voluntary on the part of the company or state-mandated. The most generous paid time packages exist in the European Union. Especially where employees do not have mandated amount of paid time, amount of time given may depend on a variety of factors — not least among these is the company’s rules regarding paid vacation.
Where paid vacation exists, workers may accrue time on a weekly basis adding a certain amount of hours per week to their vacation total. Other companies give employees access to all their year's vacation time at the beginning of employment. The accrual method is more common, however. If employees are laid off during a work year, the company might have to pay them the amount of vacation time accrued, although this is not always the case. Moreover some vacation time is offered on a “use it or lose it” basis and employees may have to take the time within a certain established period or forfeit it.
A company can offer paid vacation and sick time, or they may alternately offer something called paid time off (PTO) or flexible PTO. Flexible PTO may lump vacation and sick time together so that employees can take days as needed for any reason. This can help prevent workers from calling in sick when they truly aren’t. Other examples of PTO include pay for things like serving on a jury, bereavement, or holiday pay.
In busy companies, paid vacation doesn’t necessarily translate to actually getting to take a vacation. Especially in countries where vacation time is a benefit and not a right, employers can frown upon people taking time off and may restrict their right to take certain times off during the year. Some companies may additionally hamper an employee’s right to choose vacation times by having things like yearly shutdowns, especially around the holidays. This is common in many factory jobs and most employees end up having to use most accrued vacation time in order to get paid while the company offers no work.
Some employers don’t have paid vacation but may allow employees to take unpaid leave for a specified period each year. In countries like the US, where paid vacation is not mandated, there are still some things that a company of medium to large size must allow. Employees who have worked full time for at least a year with a company can take six weeks of unpaid family leave to deal with family emergencies, births of children, or the illness of a family member, as mandated by the Family and Medical Leave Act.