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Unlimited or accrued; that is the question. At least it’s the biggest question when it comes to creating time off policies. On one hand, unlimited PTO offers flexibility and trust, but can also lead to concerns about abuse and productivity. In an interesting twist of fate, research shows that when employees have unlimited vacation, they actually take less time off compared to those with a set number of vacation days. The work still gets done, even with more flexibility.
But there’s a price to pay when employees don’t take time away from work. Not only is PTO seen as vital to employee well-being and productivity, it increases morale and engagement, improves work-life balance, reduces stress and burnout, boosts productivity, and helps attract and retain talent.
With summer quickly on the horizon, now is a good time to review your current policy and remind team members to take some time off to rest and recharge.
Here are the Top 3 things to consider when mulling this over:
1. Time off work is good for employee health & creativity: 🎨
Research shows that taking vacations results in lower stress, depression, and anxiety, as well as decreased rates of heart disease. Encouraging employees to fully disconnect and take time off is crucial as healthier employees are more productive and creative. And healthier employees are good for your bottom line, with poor worker health costing U.S. employers $575 billion a year.
2. Vacations boost employee job performance: 📈
The proof is in the numbers, with studies showing that employees who average 10 hours a month of vacation time display an ~8% boost in annual performance ratings. Creative problem-solving skills also increase by 50% after just four to six days with reduced electronics use.
3. PTO supports career mobility: ⭐
Career mobility and upward advancement are important for retaining top employees. One study of more than 5,000 people found that workers who use more vacation days are promoted at almost twice the rate of people who use less PTO. Could that be because time away helps employees deliver better results and build the character traits that help employees rise through the ranks?
Whatever PTO policy you offer, it’s clear that employees consider it to be a key benefit.
As you head into benefits design this year with your broker or consultant, consider sending out this quick pulse check survey to employees.
