How much annual leave is the right amount?
How do you balance the desire for work-life balance against the need to keep your business moving forward?
Certain Australian companies are starting to offer extra annual leave, with some employers removing limits on leave entitlements altogether.
Offering employees more annual leave may actually increase productivity, research suggests. This is because employees are motivated to work harder knowing that a well-earned break is around the corner. What’s more, a happier, better-rested workforce reduces the risk of employee injury and burnout. Generous leave entitlements can also promote loyalty and build trust between the employer and employee, by demonstrating managers care for their employees’ wellbeing, and not just their bottom line.
While there are many benefits to increasing employees’ annual leave entitlements, keeping a small business running smoothly while people are on leave can be tricky. When everyone is already operating at full capacity, any reduction in team numbers can place a strain on business as usual.
On the other hand, if a substantial number of employees don’t take their accrued leave, this can result in an additional financial burden for your business.
Often, there is a peak season for annual leave. Families try to get together during school and festive holidays, or like to travel during winter and summer, which often means overlapping leave requests. When multiple people request leave at the same time, managers in small businesses have to juggle the competing interests of all parties. If poorly managed, this can either leave you short-staffed or handling disgruntled workers over peak holiday periods.
With this in mind, what can small businesses do to better manage annual leave?
Businesses should have a year-long view of operations, identifying critical periods where all hands are needed on deck, as well as quieter periods when staff can be encouraged to take breaks.
This will help avoid bottlenecks and short-staffing.
Transparency and flexibility
Consider introducing a shared leave calendar that all employees can access. This will give the whole office visibility of who has scheduled leave, when and for how long. Most people understand annual leave is subject to approval, based on staffing levels and work demands. Providing a central reference point encourages self-selection and helps with the leave approval process. Employees can easily identify periods where others have already applied for leave and be prudent in their own planning.
During peak holiday periods such as school holidays, try to ensure parents have the chance to take some time off to spend time with their families. If that’s not possible, consider providing flexible working arrangements to accommodate the needs of working parents.
Encourage frequent holidays
Employers should encourage staff to take regular breaks throughout the year. Not only will this help maintain adequate staffing levels all year round, but it will also ensure people are regularly getting time to rest and rejuvenate.
As for people who are looking forward to a month-long holiday, it’s important to set an expectation that such trips need to be flagged with plenty of advance notice. Start by considering how any proposed leave will impact your team and workloads, and identify ways to alleviate pain points like hiring temporary staff or potentially offering secondment opportunities for people from other teams.
Leave plays an important role in maintaining employee wellness and work-life balance, and it should be encouraged by employers. With the right processes in place, you can ensure your business is properly managing absences while ensuring people have access to the proper time to rest, relax and recuperate.
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