Killing Time: Is Your Corporate Culture Destroying PTO Benefits?

As we head into the last month of summer and stores commence with their Back-to-School bargains, many of us try to squeeze in those last bits of family vacation time with our loved ones while we still can…or, at least, we used to try.  The US Travel Association through its “Project: Time Off” compiled a report based upon a survey of American workers and their use of PTO.  According to the findings, up until about 2000, Americans were taking an average of 20.3 days off per year.  In the years since, the number of days used has steadily declined including last year when it dropped to approximately 16.2 days.  So in the US, workers leave almost a week of vacation time unused and since most employers implement “use it or lose it” type policies when it comes to PTO, those days are forfeited entirely.

What is interesting is that employers generally recognize the importance of PTO in attracting candidates and will often offer increased PTO time as part of their benefit package.  However, once onboard, many workers are not taking their well-earned time either due to their own worries about returning to mountains of work or wanting to show complete dedication to the company and/or due in large part to corporate cultures and managers’ expectations.  With the advancements in technology – most notably cellphones and the internet – even if workers are on vacation, they are often expected to be available by cellphone and to check their emails periodically.  Many states have mandated requirements for “report to work” pay (for example in NH, employees required to report to work by their employers must be paid a minimum of 2 hours under RSA 275:43-a), but the use of cellphones and/or checking email seems to skirt this law since technically the employee is not being required to report to a physical office.  Part of the erosion of the lost days can no doubt be attributed to workers receiving actual paid time and employers needing to credit back their PTO accruals while “on vacation.”

So, as an employer, many might ask: “What’s the big deal?  Workers are working more, so we are getting more production and employees have a choice on taking their vacation and they simply do not want to do so, so it is a win-win.”  Well, here’s the problem – the report also looked into why people are not taking their due time and what they found was a bit worrisome.  Nearly 58% of all respondents reported they did not feel that taking a vacation would be supported by their manager.  And of those who do actually take a vacation, roughly 17% noted feeling pressure from their boss to check in while away.

If your company culture follows the line of thinking that your employees should always be at your beck and call, here are some things you should seriously consider:

1. When was the last time you and your management team actually worked on your training and succession planning programs?
   Unless we’re talking about a top-level employee whose signature is required for financial or other emergency/necessary transactions, if your company operates in such a manner that you cannot go a week without requiring input from an employee, you have some serious risk to mitigate.  What if that employee were to find another job?  Could you really tap all his/her knowledge in two weeks (assuming he/she gives you that much notice)? Or worse yet, what if he/she becomes incapacitated or has a family emergency such that he/she cannot be reached?  While your people are obviously “too busy” with all the work you are expecting them to do, it would be in your best interest to find time for people to start expanding their skills and/or doing cross-training.  Start by carving out 30 minutes a week, every two weeks or even once a month – just start doing it!!  If you’re worried about how you can keep track of who has what training and/or scheduling cross-training or offsite training while still ensuring work is still getting done, there is software that can help you with that.
2. Are you really that savvy on your company’s true production? Countless studies have noted the benefits of employees taking vacation – including refreshed perspectives, increased productivity, healthier employees and more dedicated employees who feel their company supports their work-life balance and care about them and their families.  In spite of all the studies, if you still somehow believe your company is the exception, do you have actual data to support your position?  Time and attendance software can help you start keeping tabs on productivity, employee time and those dreaded unplanned overtime hours.
3. Speaking of overtime, have you considered the impact the FLSA overtime rules are going to have on your company?  If your culture is such that people feel so nervous about taking extended time off, then they are likely using it piecemeal one or two days at a time.  Perhaps this has never been an issue for you in the past since you have successfully categorized many of your workers as exempt, but with looming changes in the required salary thresholds (increasing from $23,600 to $47,476 effective December 1, 2016) this could all change.  So let’s say a once exempt employee whose hours you never previously bothered to track typically works 38 hours Monday through Thursday in preparation for taking Friday off.  If the manager has always made a habit of still contacting employees on a whim to answer non-emergency questions and/or requiring his/her employees to watch for and respond to important emails, it is very likely the now non-exempt employee will hit overtime.

What can you do to start changing the company culture?

1. Recognizing there are some issues and trying to change them is the most important first step!  As with any problem, first acknowledging and identifying there is one (or more than one) is vital to being able too address and correct it.
2. Implement advanced PTO scheduling.  Encourage employees to start requesting extended time off in advance.  Perhaps have quarterly reminders go out to ask employees to submit PTO requests in advance allowing managers and employees alike to start preparing and planning necessary policies, procedures and training so that the employee truly can have time off from work.
3. Create a PTO donation and/or buy back program.  Even if you change the corporate culture, there will likely still be those diehard employees who simply will not take time off or others who earn so much time after years of dedicated services that they are not quite sure what to do with it.  Many employees like to help their colleagues who have extended illnesses or family matters in their time of need, but perhaps cannot do so financially.  Why not let them donate unused time?  Or for employees facing hard times themselves or wanting that extra bit of cash for holiday gift-giving, why not let them cash out a set amount of their vacation time?

Paid time off truly is a desired benefit by almost all Americans and their families.  When asked and allowed to answer honestly, most employees would agree they want their week back.  And with the economy steadily improving, it is likely that if your company won’t give it to them, another one will…