A Practical Guide to PTO, Summer Fridays, and Flex Schedules

Just 25% of Americans take all of their paid vacation days, and of those who do take time off, 61% report working on their days off. Swedes, meanwhile, are experimenting with a six-hour workday and seeing increased productivity and happier employees. It's increasingly clear that in the modern workplace, productivity is more important than physical presence. In fact, it's never been so essential to get away from work: vacations help people avoid burnout and increase employee dedication. And an internal study from Ernst & Young discovered that employees who took more vacations had better performance reviews at the end of the year. So how can you encourage your team to step away from the desk and get recharged this summer?

Getting Creative with PTO

Led by Netflix, many tech companies have attempted to encourage people to take time off by going to the opposite extreme, offering “unlimited vacation time.” However, what started as a seemingly amazing perk has its downsides: namely, people may be less likely to take vacation days. Companies benefit, though, by eliminating the administrative expense of tracking time off, and don’t have to pay out employees for days they haven’t taken, saving $1,898 per employee. So if you do want to offer your team unlimited vacations, make sure that you encourage a culture where people do take time off.

Another popular perk is “Summer Fridays,” in which people get partial, rotating, or full Fridays off. 66% of those who had summer hours felt more productive, but the truth is, this feeling doesn’t have to be limited to summer. Offering your employees a more flexible schedule demonstrates trust and encourages them to take more responsibility for their work.

If you need inspiration (or convincing) to adopt a new vacation policy, these companies are worth investigating:

  • Hubspot has gone beyond an unlimited vacation policy by instituting a mandatory two-week vacation policy.
  • FullContact, which provides cloud-based contact management for individuals and businesses, offers "paid paid vacation” where once a year, employees get $7,500 to go on vacation. This is the estimate of what a typical family would spend on a vacation. The caveat is that employees must actually go on vacation, disconnect, and not work.
  • Bench, an online bookkeeping service, has “Summer Fridays” year round. They encourage employees to “Enjoy Independence” and manage their own workload.
  • And don’t think unlimited vacations are just for startups: General Electric has implemented the policy for executives and “senior-professional” level employees, affecting 30,000 people.

Determining Your Team’s Vacation Policy

Whatever you decide, getting explicit about time off will reinforce transparency and manage employee expectations. (Do I get a paid vacation? How many vacation days do I get? Do I have to earn my time off?) Whether your organization is considering important holidays or upcoming summer vacations, consider these three questions:

  • Who’s eligible? While employers are not required to provide vacation time, teams will need to know which employees are eligible to take time off.
  • Does vacation time accrue? Define how vacation time is earned. Be sure to explain different accrual rates for full- and part-time employees, if any.
  • How do I cash in my time? Detail how vacation time will be tracked and more importantly, communicated. Who needs to know, and how will the rest of the team move forward without this individual in the office?

Takeaway: Company values and team needs should inform a vacation policy. For companies with scrappy budgets, take time to ask teams what they really need to feel rejuvenated and prevent burnout. Ultimately, though, vacation days and flexible schedules come down to one thing: trust. Do you trust your employees to work hard when they are at work? If something goes wrong, can you rely on them to respond quickly? Working towards that culture takes time, so take one step: try out a new policy with a small group of employees, or for a short period of time. Get going: there's only 14 Summer Fridays left.

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