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Don’t Skimp on the Paid Time Off


Dont Skimp on the Time Off

Paid time off is important. Encouraging paid time-off is not just a carrot for your employees, it is truly mutually beneficial for employees and employers. Of course, it won’t hurt in convincing your employees that you are the best boss ever.

The Research on Paid Time Off

A prominent software company release a study on the effects of employee absences on productivity and the costs of no paid time off by way of a survey (the “Total Financial Impact of Employee Absences Survey”). The survey was conducted online and examined 1280 organizations. Here’s what they found.



The Total Financial Impact of Employee Absences Survey showed that when there is not enough personnel the remaining workers are typically stressed. When workers are stressed there is a greater likelihood of a loss in productivity and dissatisfaction. This in turn leads to a higher turnover and then higher costs for the employer. The Total Financial Impact of Employee Absences Survey specifically looked at unplanned absences. These absences could occur for a variety of reasons including vacation time, sick time, unexpected emergencies.

– 69 percent of respondents say unplanned absences add to workload
– 61 percent say it increases stress
– 59 percent say it disrupts the work of others
– 48 percent say it hurts employee morale occasions

Unplanned Absences

If the Total Financial Impact of Employee Absences Survey showed that absences cost more for employers and created more stress for employees, how is it possible for increased paid time off to be mutually beneficial for both.

No Skimping on the Paid Time-Off

Total Financial Impact of Employee Absences Survey showed that when the paid time off is substantial enough to allow for almost any situation that could arise, employees trust in their employer. Trust in an employer then drives productivity and reduces turnover. The Total Financial Impact of Employee Absences Survey found that when employees feel that they communicate with employers regarding non-work matters and ultimately feel like employers care, employees are more engaged and more hard working.


Time Off

Unlimited Time Off

Some companies offer unlimited time off policies. This sounds great and something that would seem to be really attractive to employees. This is not the case, however, as with no boundaries or no required minimum time off, employees are left feeling like it is not actually acceptable to take the time off especially if they want to “get ahead.” Taking any amount of the “unlimited” time off, in fact, becomes something unacceptable, and having less time off usually results in greater stress, burnout and turnover.

Tracking a Clearly Articulated Time Off Policy

The Total Financial Impact of Employee Absences Survey indicated that employers were struggling to address repeated absences on Fridays and Mondays. Specifically, the issue arose with unexpected sick time taken on Fridays and Mondays which then resulted in frustration for the non-absent employees who were then responsible of picking up the slack from the “sick” employee. The Total Financial Impact of Employee Absences Survey suggests that in some cases there may need to be deeper attendance issues and ultimately termination of the habitual offenders.


Clearly Articulate The Situation

One alternative or preemptive action step is to set a clear policy that sick time is definitely and only for actual health related appointments or illness. Sick time is not an alternative for vacation or personal time. By establishing this policy at the onset of employment and offering sufficient vacation or personal time, an employer will decrease the chances that an employee will use sick time for vacation or personal time. At a minimum, this policy will decrease the chances that an employee would be so blatant in using sick time last minute on Mondays and Fridays (when all evidence suggests that they are not truly sick).

The practice of unlimited time off exemplifies the importance of a clearly articulated time off policy. It is also important to clearly articulate the proper method for communicating about time off needs and tracking time off.

This means designating a specific number of days or offering holiday and sick time. Because we now know that employee absences do have a negative financial impact, the best way to minimize this negative impact is to plan and budget for this expense. The best way to be able to do that is to track and manage the time off offered and used.



Article provided by NECHES FCU, an Equal Employment Opportunity Employer.
Neches FCU is a Texas credit union and has an awesome team of professionals ready to provide services to our members. When their doors open at any of the nine service outlets, our goal of “Ultimate Member Satisfaction” becomes the sole focus for every staff member. They are well-known for a personal, dynamic and fast-paced work environment, providing a memorable service experience, and where clients are known by their name.
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