When OP says "PTO comes out of salary," I think they mean that the company has more money to pay a person if the person takes less PTO. For example, if a company needs a janitor role filled, and a janitor gets (for sake of simplicity) 6 months/yr PTO, then the company has to hire two people to fill the janitor role. So, if the company wants to dedicate $100k to the janitor role, each person would get $50k. With 0 PTO, one person could do the role for $100k.