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How to handle holiday vacation requests (when everyone wants off)


Ah, the holidays. It’s the time of year dedicated to spending time with family, traveling, partaking in beloved traditions and enjoying delicious meals. If you’re an employer, the holidays can also mean dealing with an overwhelming flood of vacation requests at once.

Obviously, if yours is a small- to medium-size company, your entire workforce can’t be out simultaneously. Your business has to be able to function and core duties must be covered. But you don’t want employees to feel disappointed and as though they’ve been treated unfairly.

You’re probably wondering how to handle holiday vacation requests. How do you decide who gets the time off and who has to stay in the office?

Here are some tips that can help you get through what’s often an unpleasant task – and even avoid this situation in the first place.

How to handle holiday vacation requests: 7 tips

1. Establish a paid time off (PTO) policy in writing.

Having a PTO policy will go a long way toward avoiding unpleasant surprises for employees and problems for you down the road. A formal PTO policy sets parameters and explains rules for employees taking PTO upfront.

To demonstrate transparency and fairness to all employees, it’s critical that the policy be in writing – preferably within an employee handbook – and that everyone acknowledge receipt and their understanding of the policy.

Examples of issues you can address within your policy, especially as it relates to how to handle holiday vacation requests:

  • Are there limits to how many people can be out of the office at once?
  • How far in advance do employees need to request PTO?
  • Are there certain processes you’ll use to approve vacation, especially if the number of employees wanting PTO during a certain time period exceeds the maximum number of employees that can be out of the office at once?
  • For how long can each employee be out on vacation at a time?

Apply the policy consistently, at all levels of the organization. A policy’s not worth anything if:

  • No one follows it
  • You make too many exceptions
  • Employees perceive that the rules don’t apply to leadership

Document all decisions made about vacation requests in each employee’s personnel file, including why each decision was made.

2. Have a vacation calendar.

This is simply a calendar that shows when each employee expects to be on vacation throughout the year.

Why is this important?

  • A calendar is a valuable planning tool for company leadership to know when employees will likely be out and be able to forecast staffing requirements.
  • It shows employees which dates are unavailable due to high demand. In this way, it reduces surprises.
  • It shifts responsibility onto employees to plan better.
  • This makes the vacation-request process more seamless. Any issues or conflicts that do arise – especially around sought-after holidays – can be worked out well in advance rather than involving a last-minute scramble.

It could be a paper calendar or a digital calendar.

  • It could be a calendar for individual teams, overseen by the direct manager who interacts with these employees the most and understands the workflow best. Or, if your company is smaller, it could be an office-wide calendar.
  • The calendar could open up for the entire year at once, or you could divide the year into halves or quarters.

You’ll want to allow employees to start signing up as early in the year as possible – perhaps while you’re doing your annual planning – but far enough into the new year that most employees are back at work and in a normal routine after the end-of-year holidays. February is often an optimal time.

Announce to the entire office when the calendar is open and employees can start signing up.

Express to your employees that the calendar isn’t a rigid, inflexible plan – people aren’t locking themselves into anything 100 percent. Rather, it’s just a working plan that can be altered.

Of course, this only applies to planned vacation. Despite your best efforts to be proactive, inevitably there will be times when your managers may have to get creative in managing workflow to accommodate unexpected absences but keep the business functioning. You can’t, for example, predict or avoid emergency leaves, such as some medical leaves or bereavement leaves.

3. Communicate with employees frequently.

It’s impossible to over-communicate with your employees about vacation requests, particularly those for in-demand times such as the holidays. Showing employees your PTO policy and announcing the opening of your company’s vacation calendar isn’t a one-and-done thing.

Life happens. People get busy and forget.

As part of your regular employee communications, send company-wide email reminders ahead of major holidays about the vacation policy and approval procedures.

Let employees know they can speak to you about any concerns they may have. If there’s an exceptional circumstance or an employee has religious reasons for wanting time off to observe a holiday, see what you can do to accommodate them.

4. Empower employees to resolve conflicts.

Gather impacted employees together for a group meeting to resolve vacation conflicts. The goal is to negotiate and come up with an outcome that works for everyone.

Often, employees will naturally work out these issues among themselves. For example:

  • Maybe one employee has to travel out of town to see family over a holiday and therefore needs those vacation days more than another employee who’s staying local.
  • Maybe another employee has children who will be on a school break around a holiday, and needs time off to care for them.

As they discuss their individual circumstances, it can become clear to employees which holiday vacation requests should take precedence.

This removes you from the uncomfortable – and risky – position of deciding which vacation requests have the most merit.

5. Incentivize employees to change their requested vacation dates.

Following a group meeting, if employees are reluctant to switch their vacation dates to accommodate colleagues, you may need to offer special incentives to make it worth their while. This is your way of compensating affected employees for the inconvenience of having to move vacation dates around holidays.


  • Give them a comp hour or early dismissal one day
  • Offer a floating holiday
  • Allow them to work remotely for the few days before or after a holiday
  • Pay a bonus

Do whatever makes sense for your organization’s budget and workflow, and consider what is most meaningful for your employees.

6. Allow a set amount of vacation time to roll over into the next year.

The prospect of losing vacation time can be a powerful disincentive to move vacation days, especially when it comes to end-of-year holidays such as Thanksgiving, Christmas and Hanukkah.

Check state law as well. Use-it-or-lose-it PTO policies are prohibited in multiple states such as California, Montana and Nebraska. 

If your state law provides flexibility in this area, there are still reasons that you may want to avoid a use-it-or-lose-it PTO policy.  For example, many employees worry they’ll lose that vacation time permanently if they don’t use it by the end of the year. This can make employees less compromising if conflict arises.

But if you simply drop the use-it-or-lose-it PTO policy, that fear often goes away and employees are more likely to be flexible. 

If your state allows unused vacation time to be rolled over into the following calendar year, there are practical things you should consider in developing your policy and details that you should explain in your PTO policy. Examples:

  • How much unused vacation time can be rolled over? 100 percent? 50 percent? It’s up to you to define a quantity that works for your organization.
  • How much vacation can be taken at a time? Two weeks? Unlimited time off? (You’ll want to clarify this to maximize coverage for your business, i.e. if it would create a strain on your business for any employee to take four consecutive weeks of vacation to backpack Europe, your PTO policy should identify the maximum amount of planned PTO that can be taken at once.)

7. Introduce more objectivity into the process with formal approval procedures.

If there’s a conflict about holiday vacation requests, you can skip over group meetings, negotiations and incentives if you have anticipated conflict in the first place and have formal, objective procedures for deciding which vacation requests you’ll approve and deny.

These procedures should be outlined in writing in your PTO policy so that everyone’s aware of what happens when too many people want to take vacation at once and tough decisions have to be made.

Employees need to understand that your approval of vacation time around holidays isn’t based on:

  • Favoritism
  • Discriminatory factors
  • Random selection

Examples of such procedures:

First come, first served

This is as simple as it sounds: The employees who sign up first for vacation over a certain period get those dates approved until the maximum number of employees who can be out at any single time is reached. At that point, other employees must choose alternate vacation dates.

If you opt for this procedure, be sure to notify all employees at once when the vacation calendar will open. Give employees plenty of advance warning, too – at least a few weeks.

If someone’s out of the office and misses the announcement, they could feel resentful that they lost out on the opportunity to sign up for their preferred vacation times.

Blackout dates around holidays

This is when employers don’t allow their employees to take vacation time at all, across the board, in the days before or after major holidays.

Although this seems like it would eliminate any problems with how to handle holiday vacation requests in one fell swoop, watch out. Implementing such a policy can actually cause even more problems. Chief among them:

Taking time off during the holidays is a cultural norm.

  • Families spend time together.
  • Schools are on breaks to coincide with holidays.
  • Many employees have no family nearby and have to travel to see them.

Be human first. Applying such a policy may be objective, but it can also be viewed as draconian and will put you at a disadvantage against peer companies. This is why we don’t recommend this procedure as a best practice for the vast majority of companies and industries.

Blackout dates are most commonly seen in the accounting and finance industries around certain times of year, such as tax deadlines – not major holidays.

The Equal Employment Opportunity Commission (EEOC) and religious holidays

With the exception of paid sick leave mandated by state or local laws, PTO, including vacation time around holidays, is generally a benefit – not a legal obligation.

There’s no law requiring employers to give employees vacation time around holidays – or even time off to simply observe religious holidays. However, employers can’t:

  • Treat employees differently because of their religious affiliations.
  • Coerce employees into participating in religious activities.
  • Make decisions about employees, including approval of vacation time, based on discriminatory factors.

The best tips for not running afoul of the EEOC:

  • Have a PTO policy in writing, including the process for an employee to pursue religious accommodations, and abide by it.
  • Document all vacation decisions made about employees along with the rationale.
  • Implement measures to avoid alienating some employees around holidays, such as with office decorations or celebrations.
  • Distribute your anti-harassment policy, including religious discrimination, to all of your employees upon hire and train managers on how to respond to any employee concerns or complaints.

Summing it all up

Holidays can be among the most anticipated and joyful times of year. But for employers, they can come with plenty of headaches, too. The dilemma of how to handle holiday vacation requests can be best addressed by:

  • Setting clear, upfront rules about vacation time
  • Regularly communicating and engaging with employees
  • Creating incentives that encourage more flexibility
  • Infusing the vacation-approval process with more objectivity
  • Documenting all vacation requests and the reasons behind their approval or dismissal

By doing so, you can ensure everyone’s on the same playing field and can help to prevent conflict between you and employees.

For more information on being a fair and transparent manager, download our free magazine: The Insperity guide to leadership and management.