While more than a third (38 per cent) of U.S. employers are offering employees a paid-time-off bank, up slightly from in 2017 (34 per cent), nearly two-thirds (63 per cent) say most workers don’t use it due to a heavy workload, according to a new survey by the International Foundation of Employee Benefit Plans.
The survey, which polled more than 300 employers in the U.S., found more than half (54 per cent) said they offer employees separate vacation time, personal time and/or sick time, while just eight per cent offer unlimited time off. Just 43 per cent of those offering a PTO bank said most of their employees use their vacation time. The proportion of employees who use most of their paid time off doesn’t fare any better among those employers that offer separate vacation time (48 per cent) or unlimited time off (39 per cent), with both groups also citing a heavy workload as the main reason (43 per cent and 52 per cent, respectively).
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“There has always been a push-pull between taking paid time off and employees’ workload, so this isn’t new,” says Julie Stich, the IFEBP’s vice-president of content, noting employee workloads grew during the coronavirus pandemic. However, she says as employees return to the workplace, flexibility with time-off policies could be key.
Most (80 per cent) organizations with separate paid vacation days said they don’t have blackout periods for when vacation days can’t be used. Roughly half allow salaried (53 per cent) and hourly (49 per cent) workers to carry over some unused days, while about a quarter allow salaried (23 per cent) and hourly (22 per cent) staff to carry over all unused vacation days.
There’s a recognition among employers that by making paid time off less stringent, it provides employees with the flexibility they’re seeking, says Stich. “There’s definitely recognition that for both attraction and retention, employees or potential employees are looking for flexibility in their work. They’re looking for the opportunity to make a difference and work in a job they love for an organization they respect [and] whose mission they believe in.”
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Employers who understand the importance of giving staff time off to achieve work-life balance — whether it’s allowing some flexibility to help them with caregiving challenges or to attend their children’s afterschool activities or other issues that are important to them — are signalling to their employees that they stand behind them and support them in their endeavor for positive well-being, she adds.
Still, in addition to a heavy workload, employees with separate vacation days cited challenges such as a lack of adequate staffing (24 per cent), the need to coordinate time off with other staff members (13 per cent), a preference for cash payout for days not taken (seven per cent) or because the days off aren’t supported by their manager (four per cent), organizational culture/stigma (three per cent) and leadership (one per cent).
“One of the things that employers need to be aware of is leadership support for work-life balance and taking paid time off,” says Stich. “If employers or managers are encouraging taking time off but piling more projects on employees, that . . . contradicts the message that [they] want [staff] to take [their] paid time off. So . . . leaders need to be cognizant of the messaging [surrounding] . . . the importance of taking paid time off.”
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Nearly three-quarters (71 per cent) of respondents offering PTO banks cited flexibility as the No. 1 reason for adding the benefit, followed by empowering employees (49 per cent), providing equity in paid time off (49 per cent), reducing organizational administrative time (42 per cent), improving employee engagement and retention (33 per cent), controlling unscheduled absences (27 per cent), supporting recruitment (27 per cent), increasing employee privacy (19 per cent) and to meet employee requests/desires (17 per cent). As well, three-quarters (75 per cent) of respondents offering a PTO bank said they encourage employees to take time off, though they require a minimum level of usage.
A paid-time-off bank is another way to provide flexibility to employees, rather than offering them pigeon-holed vacation or sick time, says Stich, noting it affords workers confidentiality when they take those days and is a good way to make time-off policies more equitable for all employees. Rather than disclosing an illness or a mental-health issue, employees can just take time off without going into specific reasons.
“It alleviates that kind of issue [of] administrative . . . guilt. Employers . . . don’t need to know why employees are taking [a] day off, [so they shouldn’t have to] explain . . . [or] say it’s a sick day. If the . . . day is important to you because it is your child’s birthday, you can take that day off. If it’s a religious observance [that isn’t] a paid holiday, . . . you can take the day off. It just offers [employees] flexibility and some administrative flexibility for the employer as well.”
Read: Flexible workplaces a win-win for workers, employers: report