Time off isn’t required by law, “but it’s so commonplace that employees expect it.” And for morale and retention it’s a necessity.
How the firm sets up its time off policy is its own business, says Vanessa G. Nelson, SPHR, CLRL, president of the human resources consulting firm Expert Human Resources in Flint, MI. But there are a lot of decisions it has to make.
The vacation questions
For vacation time, Nelson cites questions that have to be decided on.
- How long people have to be employed at the firm to be eligible for it.
- How much vacation to allow. “That’s over the place,” she says. But as a general rule it’s
after 90 days – six days
after a year – seven days
after two years – two weeks
after three years – three weeks
after four years – four weeks.
- The times when nobody can take vacation. Some employers have restrictions on the busy times so they don’t run the risk being shorthanded.
- Vacation restrictions around holidays. A common one, Nelson says, is that employees have to work either the day before or the day after a holiday. That prevents long absences during holiday periods.
- How to request vacation time. That varies widely. A firm “that’s really laid back,” might allow people to ask for vacation the next day. In a very formal office however, it’s not uncommon to see a 30-day request rule.
- Overlapping requests, or what to do when two people ask for vacation at the same time and only one person can be out.An easy solution, she says, is to give the time to the person with the most seniority. But what if the person with less seniority made the request first?
Set a first-come, first-served rule with a one-day limit. If both requests are made the same day, seniority rules. That way, there’s no argument that one request came in 15 minutes before the other.
The unused time questions
There also needs to be a policy on how the firm will handle unused time off.
Many small employers have a use-it-or-lose it policy while large employers generally allow accrual, sometimes for as long as five years.
Nelson’s recommendation is to let people carry unused time into the next year.
People are people, she says. IF they can’t hold on to their free time, they use it. And if the extra days happen to be sick days, “they use them even when they aren’t sick.”
If the office does opt for carryovers, it has to decide how long they can continue. Some employers allow only one year while others let people save up several years’ worth of days.
Whatever the save-up time, after the maximum is reached, it’s a matter of using the time or getting paid for it.
She adds, however, that state law can enter here. California, for example, doesn’t allow a use-it-or-lose-it policy whereas most other states do.
To pay or not to pay
Another decision is whether the firm will pay for unused time.
The advantage of doing so is that attendance improves because people want the extra money.
“They’ll jump on it if it’s cash.”
Some even see it as a slavery hike. It’s money they wouldn’t otherwise get. Her advice is pay for the unused time but do so at the end of each year. Don’t require people to carry it over, say, two or three years before they can cash out. That’s too hard for the office to track. And worse, after the third year, the office could be facing a large payout.
And then there’s paid time off
There’s also the option of a paid-time-off plan where employees get a certain number of days to use however they want.
All the days go into a bank, and there’s no tracking vacation, sick, and personal days separately.
For the office, the benefit is that the tracking is easy.
For the employees, the advantage is that they can use the days however they want. “They don’t have to lie” and call in sick when they just want to take the day off.
The office does need to protect against last-minute call-ins, however. And That’s done by setting a notice requirement for nonemergencies.
Counting days, counting hours
What about counting time off by the hour instead of the day?
Some companies allow half days, but most offices that count hours allow two-hour increments, Nelson says.
The benefit is that employees don’t have to use an entire day for a one-hour appointment. And employers can usually cover for only a few hours. The disadvantage, of course, is the tracking.
Caution: Don’t get boxed in
As far as the law goes, it doesn’t matter what the rules the firm sets for time off, Nelson says. What matters is consistency in the enforcement. “It’s inconsistency that gets employers sued.”
Every rule needs to be laid out in the handbook, and the handbook has to be followed. Then when a staffer asks “why do I have to give 30 days’ notice?” the manager can say “because it’s in the handbook.”
Discussion closed.
But keep in mind that “once something is in writing, the office has to do it that way.” And it can get boxed in by its own rules as a result.
Allow for some breathing room. Don’t say the office “will” do anything. Say it “may” do things, perhaps “we may pay this after your second year.”
Business changes. And if the handbook says the office “will pay” something at a certain time, there’s no getting out of it.
Along with that, the handbook needs to say the office can change any policy any time with or without notice.
Vacationing at leisure
And for the really progressive administrator, Nelson points out that some employers are moving to a flexible time-off policy where there is no set number of days allowed. People have unlimited time off and simply take it when they need it or want it.
Employers who use it say people act prudently and rarely is the policy abused. It creates a pleasant work environment that in turn increases creativity.
Caveat emptor.