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Take Your Time Off

Originally posted by United Benefit Advisors (UBA)

With apologies to 1960s American surf rock group Ronny & The Daytonas: Little PTO, you’re really lookin’ fine! If employers think that employees who take all their time off are less dedicated and, therefore, less productive, they couldn’t be more wrong.

An Oxford Economics study conducted for the U.S. Travel Association suggests that employers should encourage their workers to take all their paid time off (PTO) in order to gain higher productivity, stronger workplace morale, greater employee retention, and even significant health benefits. By taking time off, most employees returned to work feeling refreshed, having less stress, and were ready to focus on the job at hand.

Based on that study, the United States is one of the few industrialized countries that does not guarantee by law PTO for employees. However, PTO is still a key part of benefits packages offered by employers to attract high quality employees.

According to the study, Americans forfeited an average of 3.2 PTO days in 2013. There appears to be a disconnect between what managers believe and what workers perceive.

While some employees indicated that their employer neither encouraged nor discouraged leave, almost one in five managers considered workers less dedicated if they took all of their time off. Unfortunately for about 40% of employees, they said their heavy workload prevented them from taking all their PTO. The study highlighted some of the reasons for not taking time off:

  • There’s too much work to do
  • I’m accumulating PTO for the future
  • I can get cash for my PTO days
  • I don’t need the PTO days
  • I can’t afford to travel
  • I enjoy my job
  • PTO is hard to schedule
  • My company needs me
  • Work would pile up
  • I would make less money
  • Taking PTO would affect my performance
  • It’s discouraged by my employer
  • It would put my job at risk

Despite the plethora of reasons employees said prevented them from taking time off, the fact is that unused PTO hurts the economy in several ways. For one, employees who amass PTO create financial liability for employers and governments when they leave their position and have to “cash out” that stockpile. Another way, the study found, was that by not taking time off, employees did not travel. This non-conversion of PTO into travel or leisure time resulted in billions of dollars lost in tourism spending and tax revenue, thus hurting the economies of cities and businesses that depend on it.

PTO is one of the most expensive elements of a compensation package employers can offer. However, while PTO is costly to the employer, and clearly there is a loss of productivity while the employee is away from work, the results in the study indicate that net productivity, after taking into account the downtime of leave, is still positive.

So when it comes to earned time off, employees and employers alike should agree that it’s best to go ahead and use it. Achieving that goal most likely will require meaningful changes in attitudes and perceptions in the workplace along with more effective dialog between managers and employees. However, by doing this, it would help both groups to better understand the benefits.