When to use PTO in a year of disruption
Whether you’re an employer or employee, you’ve had a stressful few months. You’d love to be able to unwind and take some time off. But if you took some PTO, where can you really go right now? Some Caribbean islands, Alaska now, and most places in the Lower 48. That’s about it, and in some cases you’ll need to self-quarantine or show proof of a negative COVID-19 test to get in. And there’s no guarantee everything will be open in your destination of choice. It’s hard to plan, and it doesn’t really feel like you’re getting the most out of your vacation time. Plus, your business is likely trying to jump-start things after taking a big hit. Now might not be the best time for people to take PTO. But later in the year might be a worse time. It’s exceedingly difficult to know what to do. Businesses are trying a variety of solutions.
Take it now
It might not be the best time, but many employers are encouraging employees to take at least some of their vacation time this summer. They hope business will be more brisk by the fall and winter, and they fear a “PTO bomb” of requests around the December holidays. If things have picked up then, they’ll want enough staff available to deal with increased customer demand. Companies such as digital business consultancy Nerdery have capped the number of days employees can take off in the fourth quarter this year—although at 10, Nerdery’s cap is more generous than most. Thanks to shelter at home orders during what would normally be spring break for a lot of people, the amount of PTO used so far in 2020 is down around 25% compared to last year. The trouble for employees is, it’s hard to make vacation plans with limited options for safe lodging and activities in a vacation destination. With conditions changing daily, it’s hard to make firm plans. People who’d rather travel internationally can’t with a few exceptions, and people don’t want to be stuck sitting around with nothing to in a place they’re paying for when they could do that at home.
Roll time over
Some firms already had a policy of allowing employees to roll a certain amount of PTO into the next year. Others have had to institute such policies after realizing the sheer logistics of not offering it. Mental health is a big part of why we enjoy vacation. It helps establish work-life balance. Many workers feel like they can’t really enjoy time off now since they can’t do their favorite activities, and with schools and day cares closed all their free moments are spent taking care of their children in addition to working from home. While there is some congressionally approved childcare leave for those at companies with between 50-499 employees, that leaves a lot of people out. Using PTO to stay at home isn’t exactly their idea of a mental break, and the idea of losing vacation time when the calendar turns to 2021 is even worse. Overstressed employees who would feel robbed of their benefits is a recipe for disgruntled staff and poor productivity. To combat this, a third of firms responding to an Aon survey said they are allowing people to roll over more time than in previous years. JP Morgan Chase has amended its policy of letting employees roll over five PTO days through March of the next year to make it 10 days in 2021 and extending the deadline through June.
Outplacement firm Challenger, Gray & Christmas, Inc. found 33% of businesses are offering alternate options for to the traditional bank of vacation and sick days. It’s expensive, and therefore not hugely popular with firms, but some are buying out unused vacation days to keep employees happy. It’s similar to what happens when an employee leaves without taking accrued PTO, but doing it for a majority of workers in the same year could put major dent in the bottom line. Employees looking out for their colleagues can in a few places donate extra time to others who have medical emergencies or childcare issues. Tax issues complicate this, as people receiving extra time off must pay tax as if they were paid the cash equivalent. While donors are doing good and receiving a small tax break, the practice outsources responsibility for employee well-being to other employees rather than the employer. A trend that’s been picking up steam for years but might be more valuable in the COVID-19 era is unlimited PTO. Basically, if you get your work done and done well, you can take as much time off as you want. In giving employees a sense of autonomy, it earns more respect and loyalty from them. It’s been shown to increase productivity and employee retention. Rather than running the clock out on a work day, workers can be more motivated to knock projects out knowing there’s a reward of relaxation ahead, and they experience less stress knowing they can take time off in case of emergency. Businesses need to rethink everything these days, and that includes PTO.