Running A Business

Your Employees Need to Take PTO (and So Do You). Here’s Why.

Oct 15, 2021 • 8 min read
pto and vacation time
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      When’s the last time you went on vacation? What about your employees—have they been using their paid time off (PTO) lately? When asked, 55% of American workers stated they didn’t use all of their PTO or vacation time in 2019 (up to 768 million days!), and 54% of workers said they felt guilty about taking time off at all. And this is more vacation than in previous years.

      “Americans over the past few years are taking more time off to vacation, which is a positive trend over the past 4 to 5 years, which is the good news,” David Huether, senior vice president of research for the US Travel Association, told The Washington Post. “But the bad news is we still have a ways to go to get back to our long-term average. We’re still underperforming in terms of taking vacations, compared to where we used to be.”

      For small business owners in particular, many of whom juggle fewer employees than their corporate counterparts, deciding how to manage PTO across a smaller staff becomes even more complicated. 

      When employees do take time off, many companies’ culture puts the pressure on to keep working: 30% of employees report working holidays and weekends, including on vacation. For some, that’s because of demands from bosses and other coworkers—that little red dot on Slack or email isn’t going to go away without an answer—and for others, it’s because they’re constantly bothered, interrupted, or otherwise expected to keep working, even if they’re out of office.

      As we’ve seen throughout the global pandemic, this kind of hustle culture isn’t sustainable for workers or for businesses. But knowing that the pandemic has also pushed small businesses to their limits, what’s the best way to improve employee morale and decrease burnout—both yours and your employees’—while still running a functional business? That’s what businesses of all sizes are trying to answer.

      Why Some Businesses Are Turning to Company-Wide Shutdowns 

      Companies like LinkedIn, Hootsuite, HubSpot, Nike, and Bumble now offer week-long company-wide vacation days/shutdown to combat COVID-19-related burnout—and their mission is one that can be modeled to scale for small business too.

      For example, HubSpot recently announced a “Global Week of Rest” to give all employees a chance to unplug in 2021. “We know that our customers aren’t just buying our software, they’re also trusting the people who build, support, and sell that software,” Katie Burke, HubSpot’s Chief People Officer, said in HubSpot’s closure announcement. “As a result, we need to ensure those people are well-rested and able to support our customer and partner needs for the long haul. As leaders, it’s our job to show our employees that taking time off isn’t just encouraged, it’s critical.”

      By shutting down your entire business at once (or at least most of it), you can eliminate the expectation that anyone needs to do any work at all—and hopefully the pressure that comes with it.

      “Everyone was just getting increasing Zoom fatigue and feeling the stress and burnout of the year that we’ve all had, and increasing difficulty separating work and home,” Bumble president Tariq Shaukat told Fast Company after announcing their company-wide vacation. “So we started thinking: What do we do? Do we give people more time off? We realized that the constant background noise of the company, if you will, was preventing people from really, truly unplugging. So that led us to this idea of shutting down the company for a week.”

      By mandating a shutdown, workers can finally breathe easy about taking time off—and actually enjoy their PTO.  “We realized back in May [2020] that nobody was taking days off,” Ryan Denehy, CEO of IT startup Electric, told Wired. “You might not be able to go to the Bahamas, but we still want you to take days off.” Denehy offers the first Friday of every month as a bonus day off for all employees, called “Fri-yays.”

      How Will PTO and Vacation Weeks Impact a Business?

      According to Indeed, 52% of workers feel burned out and 36% of those worker feel that taking more PTO time off would help. Think of vacation time as an investment in future productivity of your small business. Not only does it give workers a much-needed break, but you’re also demonstrating how much you care about them as people—setting the tone for your culture. 

      Companies that don’t invest in their people run the risk of losing them, too. More workers are quitting their jobs in 2021 than any other time in history, and this Great Resignation could intensify if businesses aren’t prioritizing employee morale or provide competitive benefits.

      “Having true time off is essential for our mental health and, with all the technology available to us today, it is getting increasingly challenging to take off,” Kathleen Pike, professor of psychology at the Columbia University Irving Medical Center, told Conde Nast Traveler. “Having company-wide holidays can have the benefit of shared downtime and greater potential to unplug and restore our mental health reserves when on vacation.” 

      Mandating paid vacation time, or providing vacation minimums, is one way to prevent burnout. But it’s not always possible to keep the lights on with everyone out at the same time, especially for small businesses with even smaller staffing. If that’s the case, alternating vacation “teams” or mandating that employees use vacation time or PTO one at a time can help to ease the pressure—as does encouraging employees to take sick days to treat their burnout, not just their physical illnesses. For small businesses with remote workers, choosing one day per week to work “offline,” without meetings, email, or Slack expectations, can also help employees to relax and focus on more complex projects. . 

      Even for larger companies like Bumble, encouraging employee vacations has been a learning curve. They plan to implement a two-week shutdown each year in addition to their unlimited PTO policy.

      “This time around, we could not afford to give 100% of the company the whole week off,” Shaukat told Fast Company. “As we think about this moving forward, we are actively working with those teams to do a better job of staggering shifts.”

      Consider Re-Evaluating Your Paid Time Off Policy

      As you assess your company benefits in response to the pandemic, whether that’s around remote work or your back-to-office model, consider re-evaluating your paid time off, too. Ask yourself:

      • Are you offering enough vacation time and/or paid time off for your team?
      • Do they take their vacation days if they are offered?
      • Does the management team also take vacation days and PTO, including you?
      • When your team takes days off, do they still check in or post on Slack?

      It’s never too late to help your team, no matter the size, come back from burnout or to help them (or yourself) take more vacation time. “Creating cultural norms around reduced email activity during vacations and holidays can help,” Pike told Conde Nast Traveler. “Establishing a culture where people get real vacation on a regular basis can have very positive benefits for morale, creativity, and productivity.”

      The information provided in this post does not, and is not intended to, constitute business, legal, tax, or accounting advice. All information, content, and materials available in this post are for general informational purposes only. Readers of this post should contact their attorney, business advisor, or tax advisor to obtain advice with respect to any particular matter.
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