Filling the GAP in HR services: Unlimited holiday for employees?!

Filling the GAP in HR services: Unlimited holiday for employees?!

One of the trendier ideas in the big companies, especially the Silicon Valley ones, is to offer an unlimited holidays policy to staff.

For most employers, this will understandably seem like a scary concept – with most concerns centring around staff taking advantage.

But when we delve deep into it, there are further problems than just being taken advantage of to consider:

Not taking time off

In the companies where this has already been introduced, the amount of holiday that staff have taken is actually relatively low – the average is around 21-22 days off per year.

This might sound good, but it will breach your legal obligations under the Working Time Regulations: employees who work a five-day week must have a minimum 28 days’ holiday (which can include bank holidays). For part timers this is worked out on a pro rata basis.

What’s fair and unfair?

Secondly, and this is especially important for smaller firms, is that when one employee is off on holiday, their colleagues will invariably have to pick up the slack.

If one employee is taking lots of holidays but another isn’t, there will inevitably be discontent lurking in the workforce. And once that starts, it’s hard to stop it spreading.

Difficult to control

The other issue is that unlimited holiday can’t actually be truly unlimited.  Taken to the extreme, every employee could potentially have every day off.

What “unlimited” really means is that you don’t need to keep track of the holiday that’s taken, which in theory reduces admin.

But if you don’t track it, how can you make a decision about what’s actually an acceptable amount of time off when it comes to unlimited holidays?

Is it double the statutory minimum, a few days over it or substantially more annual leave?

There is no “right” answer to this question and each employee will view the situation differently.

If an employee takes “lots” of holidays and isn’t pulling their weight, how do you challenge and remedy this issue?

You can hardly say they are taking too much holiday if they are allowed to take an unlimited amount!

And in this scenario, you couldn’t remove the unlimited holidays policy from this employee and not the others.

It’s for these reasons that unlimited holiday policies are a bad idea for smaller employers.

If you want to be generous, you could give them more than the statutory minimum – e.g. 30 days’ holiday each.

If you increase your holiday entitlement in a given year, you could also use it instead of a pay rise.

And if holidays are the least of your worries, and you have problems getting your staff to even work properly on their current days, please give me a ring on 01491 598 600 and we can work out a strategy.


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