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How to handle unused vacation days amid COVID-19


Usually by the fall, employees have used much of their paid time off (PTO) on spring and summer trips.

But with hardly anywhere to go during the COVID-19 pandemic, unused vacation days have piled up at many companies – a phenomenon called PTO hoarding.

Should you encourage employees to take PTO? Depending on your PTO policy, those leftover days will either be:

  • Lost
  • Rolled over
  • Paid out

By considering the impact on both your employees and your business, you can develop a strategy to address a surplus of unused vacation days that puts everyone in the best position in the future.

Your employees probably need a break.

If you have employees working from home for the first time, initially it probably felt like a vacation just to skip their commutes and perhaps stay in pajamas.

But by now, that novelty has worn off. And we’ve learned that working from home is definitely not a vacation.

Instead, it’s a new abnormal that sometimes means:

  • Spending more time in front of screens
  • Working longer hours
  • Feeling confined

Or perhaps your employees have continued going into the workplace amid the pandemic. They might feel like they’re putting their health on the line for the sake of a paycheck (and their livelihood).

Those conflicting feelings – between risk and the need to earn a living – can be taxing on an individual.

No matter your employees’ unique case, chances are they need a break.

Time away from work is always necessary for employees to avoid burnout and bring the most productive energy to their work. During an especially stressful season, it’s even more important.

You can make PTO policy changes.

As an employer in an uncertain economy, you may also be trying to conserve cash and would rather:

  • Avoid paying out employees for more unused time off than you usually do at year-end
  • Or prevent the extra days from rolling into the next year

In this case, making formal changes to your PTO program is an option you can explore if it seems necessary to put your business in the best position going forward.

To address excess unused vacation days with policy adjustments, you could:

  • Implement mandatory PTO (requiring employees to take a minimum amount of vacation time).
  • Limit the amount of days employees can take off during certain periods, which may help prevent a flood of PTO requests all at one time.
  • Increase the number of vacation days that you allow employees to roll over into the next year (if you want to avoid large payouts).
  • Offer to cash out more PTO than typically allowed (if you would prefer to minimize rollovers).
  • Set up a program where employees with excess time can donate it to coworkers without enough PTO remaining.

You can encourage PTO use without policy changes, too.

Your employees may perceive new rules about how they can use their PTO (such as mandatory time off) as another unexpected change in their lives on top of a string of many others that have been beyond their control in 2020.

For this reason, you may want to avoid making official policy changes and try a softer approach to encourage your employees to take time off.

Here are five actions you can take that should help reduce a buildup of unused vacation days:

1. Lead by example.

Take days off yourself and encourage other leaders in your organization to do the same.

If you rarely take a vacation, your employees will have a hard time believing it’s truly okay for them to do so.

Share your plans with your employees and demonstrate the benefits of some rest and relaxation by sharing pictures and stories when you get back to work.

2. Provide ideas.

You can combat the “nowhere-to-go” mindset by creating and distributing a PTO guide full of:

  • Day-trip ideas in your area
  • Local volunteer opportunities
  • Other local activities that may help employees:
    • Get exercise or rest
    • Spend time in nature
    • Make meaningful connections with friends and family
    • Enjoy music and the arts

3. Talk about PTO often.

When your team members use PTO, encourage them to share how they spent their time with colleagues after they return and with you during one-on-one meetings.

Ask questions, show genuine interest and avoid any joking remarks that may make using PTO seem like a negative (e.g., “Who approved that?”).

Not only does this sharing help inspire more of your employees to use their time-off, it also becomes a team-building opportunity that strengthens social connections among your staff.

Remember: at the end of the day, building real, human connections with your team is an effective way of creating an environment of trust and understanding. Small talk goes a long way.

4. Give employees time to catch up.

It’s not very much fun to go on a vacation when it seems like everyone else is counting down the days until you return and respond to their messages.

After your employees take PTO, tell them you know they have a lot to catch up on, and then give them the time and space they need to properly go through their missed calls and emails.

5. Staying flexible.

COVID-19 has impacted our workplaces in ways that seem too frequent to count.

The key to addressing the pandemic’s impact on PTO usage is to stay:

  • Supportive of employees
  • Flexible with your expectations
  • Strategic in your planning

To learn more about the importance of addressing minor HR issues — like unused vacation days amid a pandemic — before they impact productivity and progress, download our complimentary e-book: How to develop a top-notch workforce that accelerates your business.