HR Urged to Help Reduce Unused Vacation Time

By Rebecca R. Hastings, SPHR Jun 23, 2011
Timothy G. Wiedman, PHR, understands the challenges organizations and employees face when there’s plenty of work to be done and weeks of accrued vacation time to be used. Once he lost a nonrefundable deposit for a ski vacation because his company scheduled a meeting during his planned absence that was, according to his boss, “too important to miss.”

“As the top regional manager in my area, I had a great deal of discretion in scheduling my vacations,” he told SHRM Online. “Unfortunately, the corporate calendar could not be trusted,” he said, and often meetings were scheduled at the last minute.

Fortunately, the company tried to make up for such situations: “These last-minute meetings occurred often enough that the company regularly made exceptions to its ‘use it or lose it’ vacation policy,” according to Wiedman, because many of the regional managers had accrued vacation time well beyond the official maximum.

Unfortunately, this practice ultimately resulted in a financial burden for the company. “When I eventually took a buyout during a downsizing, I was owed 50 percent more vacation time than I was officially allowed to accrue,” Wiedman said. The company paid it in full.

Workload is just one of many reasons American workers often fail to use all the paid vacation time they earn each year. According to a CNN article posted May 25, 2011, U.S. employees gave up 448 million earned but unused vacation days in 2010. Moreover, as SHRM Online reported, nearly a quarter of American workers said they couldn't afford to take a vacation in 2011.

Yet skipping vacations not only deprives employees of the opportunity for rest and relaxation, it also can leave employers with a financial liability in the form of accrued leave that must be paid at time of termination, depending on state law.

Reasons for Avoiding Vacations

“Employees frequently decline to take vacation time because they fear that either their work won't be well supported, and they'll come back to a large amount of catch-up work and failed projects, or that their work will be too well supported and their superiors will realize they can get by fine without them,” said Mitch Kocen, assistant marketing manager for, a San Francisco-area jobs website.

Employees are likely to hoard vacation when they are uneasy about their jobs, agreed Greg Szymanski, an HR professional from Washington state, because they want to stockpile leave that will be paid out as cash if they are terminated or because they don't want to be perceived as slackers.

Additionally, Szymanski noted, “getting dragged into work matters while on vacation” can make vacation less tempting for some people.

Yet, “bosses who act put-out or annoyed when an employee uses vacation time will be the biggest deterrent of all,” Kocen said.

“I believe several things get in the way of employees taking vacation: an underlying unwillingness to spend too much time with family, too much pressure at the office, and managers who don't approve specific vacation requests,” said Bettina Seidman of SEIDBET Associates, a New York-based career coach and former HR director.

“If employers want their workers to take their vacation time, they need to assuage these fears,” Kocen said, such as by distributing work so that no one person is responsible for everything.

But Seidman said that employees who work long hours all the time, including evenings and weekends, often are unwilling to be at home, often because they are in an unhappy relationship or have other issues at home.

"There are some people who just find life more pleasant at work than away from work," Szymanski acknowledged. "I know several people like this; after two days of vacation with their families, they are pulling their hair out."

Wendalyn Tisland, SPHR, coordinator of labor and employee relations at the University of Alaska, said she's heard employees say they don't want to take time off when the kids are home from school. That's why she tries to take a day or two during the academic year—when kids are at school—to be home alone.

Vacation-Friendly Policies

A well-designed vacation policy can encourage employees to use vacation in a timely fashion.Szymanski said organizations should not:

  • Implement a “use it or lose it” provision—which is illegal in some states.
  • Permit employees to take unpaid time off if they have accrued paid time off available.
  • Allow employees to trade unused vacation time for cash.

Seidman agreed that offering cash to employees who don’t use all their vacation is an incentive not to take vacation. “Where only a couple of weeks of vacation are [available], there is usually not much of a problem,” she said. “But in organizations where staff can accrue four weeks of vacation or more, employees will often want to trade a week or two for cash.”

Szymanski suggested that employers “implement a maximum number of hours that can be accumulated. … Then future accruals will be suspended until accrued hours drop below the maximum.

“We did this and all of the sudden ‘vacation hoarders’ starting using vacation,” he told SHRM Online.

Seidman recommended that vacation policies include a deadline for using the time off.

Jodie Shaw, CEO of ActionCOACH, a Las Vegas-based business coaching firm, agreed.

“We write in our vacation policy in our handbook that we expect all team members to use allotted vacation time in a year,” she said.

Shaw said the company takes steps to enforce this policy: “I have our HR person send me monthly reports on vacation,” she said. Shaw then speaks with those employees who have leave accumulatedabout planning a vacation before the year is out.

Other Things Employers Can Do

“Some organizations actually celebrate their employees’ vacations by providing areas—physical and electronic—to post pictures and stories about their journeys and destinations,” said Michael Denisoff, SPHR, a Los Angeles-based management and HR consultant and CEO of Denisoff Consulting Group.

“It is important for managers to encourage the use of vacation days by taking vacation days themselves,” he added, and to remind employees periodically to plan their vacation days so their workload can be allocated to others.

Kocen's advice: Post a vacation calendar, online or on site, that shows who is taking time off, and when, as well as expected “crunch times” when extra help is needed.

If all else fails, encourage employees to take long weekends, Tisland suggested, particularly when they feel that they can't afford a proper vacation.

Experts say that organizations should view vacations as part of their overall employee wellness strategies and as a key element in ensuring that the workplace is flexible and productive.

“The focus should be on generating healthy and happy employees,” Denisoff said. “Periodic vacations, whether short or long, help employees stay refreshed and renewed.”

Rebecca R. Hastings, SPHR, is an online editor/manager for SHRM.

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