How to Mitigate Potential Business Issues Caused By Untaken Staff Vacations

One solution is to offer employees more options when it comes to annual leave, such as extending your vacation period into your next financial year (or two years) and/or offering additional pay for unused vacation time.

During the Coronavirus pandemic, businesses all over the world have had to quickly adapt and find new ways to keep their employees working. The ripple effect of lockdown has meant that individuals can no longer go out about and stick to their plans—including when it comes to travel. This, in turn, has led to a significant number of employees cancelling their annual vacation. From a business point of view, this cancellation can cause problems if those employees then wish to rebook later on in the year. Let’s take a closer look at how to mitigate potential problems caused by untaken staff holiday.

How Coronavirus Has Impacted Staff Vacations

Due to the spread of Coronavirus, 2020 has been far from a normal year when it comes to travel. In most countries, Coronavirus-related restrictions have been in place for many months. Parts of Europe and the Caribbean started reopening for travel in June, but other countries—particularly where Coronavirus rates are high—no doubt will take much longer.

While restrictions have been in place, most employees have had to cancel their holiday plans—be they abroad or at home. This means the majority of employees likely also have cancelled their time off from work, perhaps with a view to taking it later on in the year. While this may seem like an obvious and reasonable request, it can cause problems for work places.

What’s the Problem with Untaken Staff Vacations?

The average employee in the U.S. accrues between 10 and 15 days of annual leave per year. In most workplaces, this vacation time is managed easily, as employees know they cannot all be off at the same time. Time away from work usually is evenly spread out across the year.

While travel hasn’t been an option for many people for the last three to six months, employers probably will see an influx of vacation requests for the second half of the year. Depending on the number of employees, this can be problematic in that vacations are likely to cross over—and too many people will want to be off at the same time.

Deciding whose vacation should be approved or rejected is difficult at the best of times, let alone when staff members are making requests all at the same time. Problems relating to untaken staff vacations include:

  • A potentially short-staffed workplace
  • Risk of upsetting and alienating staff when vacation requests are rejected
  • It can be difficult to find a fair way of dealing with vacation requests
  • If you do reject vacation requests, staff may feel stressed and overworked if they haven’t had time off in many months

It’s important to consider the best ways to deal with such problems when Coronavirus restrictions are lifted, and staff wish to use their untaken vacation time.

How Can Vacation Entitlements Be Managed When Work Returns to Normal?

In most cases, the fairest way to determine which vacation request gets approved is to operate on a first-come, first-served basis. This usually would involve having a set amount of staff allowed off at one time, and once those requests have been made, no one else’s vacation gets approved.

However, when travel is allowed once again after Coronavirus restrictions are lifted, it’s likely that HR departments all over will receive a multitude of vacation requests at the same time. This means it might be necessary to find a new way of determining who can have the annual leave—or, indeed, to find a way of limiting the number of requests that come in.

Dealing with an Influx of Vacation Requests

There are a few measures you can take to avoid having to make tough decisions regarding whose vacation is approved and whose is rejected. Ideas include:

  • Introduce a temporary policy that limits the number of days an employee can take in one month—such as two or three, rather than weeks at a time.
  • Allocate leave before requests are made, ensuring that staff have the number of days they are entitled to. In this instance, you could offer employees the opportunity to trade leave periods with one another, much like they would need to find staff to cover shifts.

Limiting the Number of Vacation Requests

Another method is to offer employees more options when it comes to annual leave, so that you indirectly discourage them from requesting time off at the same time. Consider:

  • Extending your vacation period into your next financial year (or two years), giving staff more time to use up their accrued leave
  • Offer additional pay for unused leave, instead of the time off. A cash incentive might be enough to stop your employees requesting vacation time.

Regardless of how your business chooses to deal with untaken staff vacations, remember it’s important to be mindful of maintaining your employees’ good mental health and well-being. This has never been so important as in 2020, which has certainly been one of the most trying and turbulent years in recent history.

Steven Cox is chief evangelist at FMP Global, a leading international payroll services provider to SME organizations.

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