Spring is Here! Revisit Your Vacation Policy


Spring has sprung and those request offs are rolling in. There is a happy place somewhere between keeping employees motivated and maintaining a competitive edge in business…the problem is that it’s pretty hard to find. The good news is that other leaders have been there and done that, and they’ve reported back. Workplace leadership expert and Inc contributor, Lauren Folino outlines a few points for organizations to consider when crafting vacation policies

Legal Compliance

Employers are under no legal obligation to offer their employees vacation time. While employers don’t have to give employees this time off, it is a pretty standard benefit that they voluntarily offer. So while you aren’t legally obligated to offer vacation time, it makes total business sense to do so for a few solid reasons.

  • Employees have come to see this as a standard benefit. To not offer it, would mean losing a competitive edge in attraction and retention.
  • Time off of work has been known to improve health, lower stress levels and decrease the instance of absenteeism at work.
  • Time off has also been proven to actually increase productivity, engagement and creativity.

Employers are however, legally obligated to provide up to 12 weeks of unpaid leave each year to employees who qualify for Family Medical Leave under the FML Act without the threat of losing their job. Folino defines this type of leave:

“Employees that would qualify for this type of leave include persons that are caring for a sick family member, persons who must leave due to a serious health condition that prevents them from working, or persons that have to care for a new child, birth, adoption or foster care.” 


Different vacation policies will achieve different business goals. Leaders have to first define what they want to get out of their vacation policy. Human resources expert, Steve Kane, defines the three types of goals that businesses can achieve with differing vacation policies:

  • Companies can offer vacation time as part of a reward structure. In this model, the goal is to retain employees with the reward of time off. Employees can earn more time off with tenure or productivity. Vacation time can be a strong retention tool.
  • They can also offer vacation time to minimize costs. Healthcare costs, absenteeism and low engagement rates can all be decreased with vacation time. In this structure, an investment in employees is seen as an investment in the organization.
  • Or vacation time can be considered part of the company’s competitive advantage. Attracting talent is a whole lot easier when you have something to offer, and time is the hottest commodity around. In this model, offering vacation time is used as an attraction tool.
Get Employee Input

Makes sense right? When crafting any benefit or policy for employees, their input should be solicited and acted upon. First, find out what employees wish to gain from their vacation policy and then put a few options up for vote. Kane recommends offering two defined options and then a third option of “indifference”. Incorporating this third option increases your chances of pleasing a larger number of employees.

A recent Accedo study on vacation time policies found that when employees aren’t happy with their vacation packages, they will start to abuse days off and even resort to absenteeism. Furthermore, the absenteeism that results has very negative affects on their co-workers and their environment.

  • 29% of workers get upset with their co-workers if they take multiple long weekends off.
  • 25% of workers get upset with their co-workers if they leave the office early.

Employee input is vital to a vacation policy that will satisfy employees and be adhered to.

Policies, compliance and procedures don’t have come from scratch. Remember that while your organization’s unique needs have to be considered, there is always some great advice to seek out from others who have been down that road before you. What do you wish to achieve with your vacation policy? Let us know how your organization dealt with time off, vacation time and PTO in the comments.

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Scarleth White via