Redesigning Vacation Policy

[Guest Nancy Hill]

Our current vacation policy is based upon individual's "year" -- hire mm/dd to hire mm/dd. 2 wks 1-7 yrs; 3 wks 8-13yrs; 4 wks 14-20; 5 wks 21+. This seems somewhat antiquated with labor shortages and need to "attract and retain" being a priority. Want to revamp policy to a calendar year basis - any suggestions?

[Sheila K]

Nancy:

On my first glance, the antiquated portion of this seems to be the amount of accrual, not when to begin/end it!

We had a similar retention problem and have recently updated our accruals to reflect a larger "jump" after 2 years. By shortening the time between increased accrual amounts, you may have folks taking a second look before making a "leap" to another position.

Our accruals begin at hire date and accruals change at 2 years, 5 years, 10 years, 15 years, 20 years and 25 years. There is an entire other arguement about long term employees and excessive vacation that I won't get into here!

Although we are moving to a PTO plan in January 99, I will also add that up until PTO time, we also had another level for our part-time employees (tellers mostly) who would have an increased accrual at 1 year.

Good luck!

Sheila K

[Guest nac]

Sheila's got the right idea - it's the amount of time between "jumps" that is unattractive. While 2 weeks per year is standard, I wouldn't make my employees wait 8 years to go to 3 weeks. You could try smaller increments - say 10 days for the first 2-3 years, then go to 12 days years 3-5, 15 days years 6-9 -- a little tougher to administer, but provides more of a longevity incentive. By the way, we're in the insurance/financial services industry and we start at 3 weeks per year.

[Guest ERead]

I've worked in several differnet industries. Now in the Financial world. Most of my employers have had a jump after 3 or 5 years. Usually an extra 5 Bus. Days. Another thing you may consider is allowing the carryover. This is my first postition that isn't a use it or lose it per year situation. There is however a maximum allowable at one time and a max accrural. 149.9 hours and no more than two consecutive weeks in a quarter period. Just some more food for thought.

[Guest j5223b]

Our policy is no vacation during the first 6 months, then they accrue .83 days beginning the 7th month and can take it in advance. The next break is 5 years with 3 weeks, 10 years with 4 weeks and so on up to 6 weeks after 20 years. Good luck.

[Guest capshaw]

I agree with most of the above. However, one important factor is missing from this discussion. That is, what are your competitors doing? Of course, I'm speaking of the companies with which you compete for employees. If they all have similar vacation schedules then the primary reason you would change yours is to be the leader and attract the "cream of the crop." Don't change any benefits unless you've looked at the competition too.

[Guest Morgan]

I do like the idea of sharing competitor benefit information. What is the best way to go about gaining this information? Any ideas? I currently work for the general contracting industry in Texas and Denver and would be curious to hear from my peers.

Thanks for your help.

[Guest Lori Senter]

Often there are published surveys for your area from organizations like Hewitt, Mercer, etc. They may be more general than what you need.

You may also check with your local Chamber of Commerce or Industrial Development/Recruitment Board as they may have such surveys to use with companies contimplating a move to your area.

Finally, nothing beats an old-fashioned phone survey. You can pick a few competitors in and out of your industry (anyone who would employee the type of people you're looking to attract) and just call their HR manager or another manager. You can offer to share information if that might make them more willing to answer your questions. I have found most fellow HR/Benefits managers to be pretty helpful in situations like this.

Good luck!

[Guest Melissa White]

Are there laws regulating pay-out vs roll-over?