Your 5-Step Guide To Creating A Time-Off Policy

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Creating a time-off policy for your company is a great way to help employees stay productive while staying healthy. It’s also a great way to ensure your company has a positive and productive culture. A time-off policy that is enforced will keep your company moving forward. If you lack a decent policy, it can create morale problems and drive your best people away.

Before diving into the creation of your time-off policy, it’s essential to understand the basics.

What Is A Time-Off Policy?

Time-off policies differ from company to company, but in general, they are policies that determine how workers can request time off, how much time off they get, and how they will know when they can take time off. These policies also include how employees can request additional time off.

Unlimited Vacation Vs. A Set Amount Of Vacation Time

There are several different types of time-off policies typically used by HR teams. However, the two primary examples of time-off policies are unlimited vacation time and a set amount of vacation time.

An unlimited vacation policy allows staff members to take as much vacation time as they need. This is often based on the belief that staff members are responsible enough to manage their time off. This is also based on the thought that workers who are happy with the company will be more productive. These flexible time-off policies, in theory, are also believed to help staff create a better work/life balance, help boost their overall morale, and decrease employee burnout. Most unlimited policies set a minimum amount of time off in tandem with the policy to encourage employees who might be scared to take too much time off.

A set amount of vacation time requires employees to take a specific amount of time off each year. This is a more traditional policy often used when the company has a precise amount of vacation time that they want employees to take. These policies are usually created because managers and HR professionals believe everyone will be more productive if they have a set amount of vacation time.

Either policy can work for employees, and you might have both depending on what they are doing.

How To Create a Great Time-Off Policy In 5 Simple Steps

Now that you understand the basics of a time-off policy and how it can help your company, you’re ready to start creating your own. Here are some tips to help you create a great time-off policy.

1. Get Clear On Time-Off Accrual

One of the first things you need to do when developing your time-off policy is to define how much time employees get off, accrual policies, etc. This is essential to creating a successful time-off policy that will be easy for employees to understand.

You’ll want to start by first carefully defining what accrual means. This is the amount of time a worker earns for each year they work at your company.

You’ll also want to define what the maximum time-off a person can take is. What is the cap of yearly vacation you want to offer tenured employees?

Additionally, you’ll want to define when employees can start taking time off. This will be based on how long they’ve worked for you. For example, if you decide to give your employees two weeks off a year, you’ll want to define how they can start using their time off. What does this look like? Well, they can start taking time off after they’ve been working for you for six months. This will ensure that they have time to learn the ropes of their job and understand your company culture.

You’ll then want to make sure you carefully define how each staff member can earn additional time off. In most cases, workers gain extra time off for each year they work for you. However, some companies offer additional time off with promotions or other special occasions to show appreciation for their employee’s hard work.

2. Understand The Limits Of How Time-Off Is Used

The next step in creating your time-off policy is understanding how you want employees to use their time off. There are several different ways you can use your time off. Here is a short and noncomprehensive list you might want to consider when drafting your time-off policy:

  • Vacation Days
  • Sick Days
  • Holidays
  • Personal Days
  • Parental Leave
  • Sabbaticals
  • Bereavement
  • Short-Term And Long-Term Disability
  • Military Leave

You’ll want to define how each of these days/periods can be used and what they are used for. For example, it can be hard for some people to distinguish personal days vs. vacation days, so some organizations combine the two. You’ll also want to clarify what workers need to do to claim they are taking a sick day. Do they need to go to the doctor and get a note, or will you let employees claim days if they have something self-diagnosable like a cold? Go through each type of time off and determine the definitions and rules regarding that time of leave.

For vacation and sick days, decide if your employees can bank or cash out time off. This is where an employee trades in their time off for cash. This is often done in companies where employees are paid hourly, and employers need staff help throughout the year.

3. Managing Time-Off Requests

Another important part of creating your time-off policy is to define how your people can request time off. You’ll want to start by defining how they can ask for time off. This is often done by giving employees a form to fill out and submit to their manager.

You’ll also want to define how much notice they must give when requesting time off. Traditionally, many HR teams require at least two weeks’ notice when requesting time off because it takes time to process the request and ensure that someone can cover the employee’s time and duties.

Additionally, you’ll want to define how you will notify employees if they are approved for time off. For example, you might notify them via email or text message. You always want to notify employees in a written format. With written notice, there is no confusion about who’s approved for their time off and when. You’ll want to be careful about rejecting time off requests. Employees deserve the time-off they were promised, so managers should be as flexible as possible (while making sure bases are covered.) If things are getting too out of hand, consider having a temporary talent pool ready to help.

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4. Set Mandatory Minimums On Time-Off

Employees need rest and extended time with their families. Some staff spend a lot of energy at work and find it challenging to take time off. Set some expectations for each employee so that they are getting enough time away from work. This ensures that all your employees are taking at least the minimum amount of time off.

5. Ensure Each Employee Signs Off On Your Policies

Once your policies are outlined and defined – you’re ready to put them into practice.  Whether staff fill out physical paperwork or utilize employee onboarding software, you’ll want to make sure that you include a copy of these policies and have each employee sign off on them.

This is important because it will ensure that each new hire is familiar with your time-off policies and understand what they can and cannot do. It will also help you spot any potential problems or issues with your time-off policies.

How To Ensure Time-Off Compliance

Getting employees to sign off on your time-off policies is only half the battle. The next half is making sure that employees and managers are compliant with your policy. Here are some strategies you can use to make this happen:

Encourage Managers To Share When They Take Time Off

Managers and supervisors are in a unique position because they have a direct impact on employee morale. Therefore, you’ll want to encourage managers to share when they take time off. This will help the employees under them feel like they too can take time off.

For example, you could have a spot in your company newsletter dedicated to sharing travel and time-off from managers and supervisors. Get leaders to share photos and a quick blurb about the trip they took.

Create Check-Ins Throughout The Year To Catch People Who Aren’t Taking Time Off

It’s essential to make sure that your time-off policies are being followed. Therefore, you’ll want to create check-ins throughout the year to ensure that employees are using their time off.

You should be keeping up with how many vacation, sick, and personal days an employee has used. If they aren’t taking enough vacation time, get some details as to why. Are they struggling with their workload, manager expectations, or something else? Let them know that you are there to support them.

This will ensure that staff is taking their time off.

Brainstorm With Direct Reports On Ways To Take More Time Off

Finally, you’ll want to engage in some brainstorming with your direct reports to find ways to ensure that everyone on staff is following your time-off policies.  This is important because it will help you build a culture where people are encouraged to take time off when they need to.

The Right Time-Off Policy Can Boost Productivity And Employee Morale

Employee time-off policies are essential to ensuring that your employees are well-rested and happy. They also play a vital role in ensuring that you have enough coverage so that your business is functioning smoothly.

This is why it’s crucial to have a clearly defined and well-communicated time-off policy. By following these tips, you’ll be able to create a time-off policy that will boost your employee morale and productivity.

Are you looking to perfect other policies? Read our article on creating a stellar social media policy.

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