Vacation Instead of Annual Increase
shackmorris
11 Posts
One of our administrators proposed the possibility of giving employees the option of requesting additional vacation to supplement accrued vacation time instead of a salary increase. Our company considers pay increases companywide on an annual basis which usually averages between 3 and 5%. The administrator thought it would be a great idea if employees had the option to receive additional paid time off instead.
We only have about a handful of employees who reach their maximum vacation accrual. However, we have several that are always running out. Aside from determining how cumbersome this will be to maintain in our H/R and P/R systems, would like any advice and/or comments anyone has before presenting to owner and other administrators.
Any advice appreciated!
We only have about a handful of employees who reach their maximum vacation accrual. However, we have several that are always running out. Aside from determining how cumbersome this will be to maintain in our H/R and P/R systems, would like any advice and/or comments anyone has before presenting to owner and other administrators.
Any advice appreciated!
Comments
Let us say the EE selected more vacation for year one. Would that mean that EE would always have that 'extra' time? Because once you get a raise, theoretically, you get paid that extra money every year from then on and all of your future increases are calculated on a higher base. Compounded over time, that would amount to a significant amount of money.
I am probably not being very clear, but I see this as a potential mistake for the EE unless you are going to try to balance out the "penalties" described above. On the other hand, it could be a financial windfall for the company.
I will keep you posted.
Thanks again
The ONLY time we offer more is at the INITIAL hiring phase. As an incentive we may put the employee ahead of the schedule based upon experience or need. After that they must comply with the requirments of the manual before accruing anymore time off.
Helpful?
Marty
Employees are allowed a maximum vacation accrual balance, then our system stops accruing until the EE uses some vacation. If most employees were given an extra week it would average about 2% for most of them. Our accrual system is seniority date based and depending upon how many employees elect the option this will place a burden on us to track. There seem to be a lot of issues we need to consider and everyone's response has helped a great deal. Rarely, we will agree at time of hire that vacation accrual starts right away as opposed to end of orientaion period, also based on our need.
Everyone's response has been helpful and I've presented to our General Counsel.
Thank you