Can time increments play a role in company PTO policies?

Q     What’s the minimum amount of time we can require exempt employees to use their paid time off (PTO)? Under our benefits policy, a half day (four-hour deductions) for exempt employees is usually OK, and our nonexempt employees can take PTO one hour at a time, but could we require a similar two-hour increment for exempt employees, as well?

Neither the Fair Labor Standards Act (FLSA) nor Idaho law includes a specific provision requiring time-specific increments of PTO for exempt employees. However, regardless of the increments permitted under your benefits policy, the salary basis requirement under the FLSA must always be met.

The salary basis provision requires full compensation in the predetermined amount for weeks in which any work is performed by the exempt employee and prohibits reductions from that pay unless covered by a specific exception. One such exception is for full-day absences unrelated to sickness or disability. Tracking PTO use isn’t covered by these same restrictions and can be reduced in any time increments to account for absences from work, full day or not.