According to the International Foundation Employee Benefits Survey, vacation time is one of the most commonly offered employee benefits, with approximately 97% of employers in the United States offering paid vacation days. The U.S. is one of few countries in the world without mandated vacation benefits, allowing employers to design their own vacation policies.

In Canada, in addition to any other time-off benefits, provincial governments require employers to offer two weeks of vacation for every year of completed employment. These requirements will change following the passage of Bill C-86 in December 2018. Effective September 2019, vacation requirements will increase based on years of service: two weeks after one year, three weeks after five years, four weeks after ten years.

In recent years, employers have begun offering a number of innovative vacation benefits to encourage workers to unplug from work—something that can benefit both the employee and the employer!

Why Don’t Employees Use Their Vacation?

U.S. and Canadian employers struggle to get employees to use all of their annual allotment of vacation time. Employees value paid time off, yet they leave time on the table every year. Some of the reasons employees aren’t taking time away include:

• Technology and attachment to email
• Fear of returning from vacation to increased work
• Fear of being perceived as uncommitted to their career
• Missing out on projects or assignments
• Mixed messages from managers who remain connected to the office while on vacation
• Guilt of leaving additional workload for co-workers.

Why Are Employers Adopting Innovative Vacation Benefits?

Some employers have designed vacation policies that encourage their workers to use their vacation time. The goals of such policies are to:

• Retain employees
• Attract employees, especially those midcareer or willing to relocate
• Decrease absenteeism and presenteeism
• Allow employees to recharge, de-stress and come back to work more productive.

Could Your Company Benefit From an Innovative Vacation Policy?

Take a look at your unique workforce when considering which vacation policies will work best for your organization. If you’re looking for some ideas, here’s a roundup of some of the latest offerings from U.S. and Canadian employers.

Stipends and Travel Allowances

• Airbnb offers employees a $2,000 annual stipend to use at any Airbnb in the world.
• Full Contact offers a $7,500 annual vacation stipend and requires employees to fully disconnect from work. An employee has to go on vacation to receive the stipend.
• SteelHouse offers a $2,000 vacation stipend per year, increasing to $5,000 after five years of service with the company and an additional $1,000 every year after. The company also offers a three-day weekend every month that doesn’t have a company holiday.
• BambooHR offers a $2,000 annual stipend.
• G Adventures gives employees a travel allowance of up to $2,900 every 10 months toward one of its trips and flights.
• Moz gives both U.S. and Canadian employees $3,000 a year to spend on vacation.

Incentives

• The U.S. Travel Association pays its employees $500 annually to use all of their vacation days for the year. The association went from having 19% of its employees use all their vacation time to 91%.
• Basecamp provides employees $5,000 annually in a use-it-or-lose-it fund and offers three weeks of vacation time using the honor system, with no tracking mechanism.
• Acceleration Partners employees receive a vacation bonus of up to $750 for taking a full week of vacation and unplugging during vacation.

[Related Reading: Trends in PTO and Vacation Offerings—Just in Time for Summer]

Unlimited Vacation

• Ceridian offers its U.S. and Canadian employees a flexible vacation policy, allowing employees to take as much time off as they want.
• Financial Engines offers exempt employees unlimited time off.
• BuildDirect offers its salaried Canadian employees unlimited vacation days.
• Kronos offers its employees “myTime,” otherwise known as “open time off.”

Learn more about unlimited vacation in Unlimited Paid Time Off—Who Benefits?

Buy/Sell Vacation Programs

• KPMG’s Canadian employees get three to five weeks off a year, plus the ability to purchase additional time.
• American Express employees can get up to 28 vacation days and the opportunity to buy and sell vacation.

Learn more about buy/sell vacation programs in Meeting Worker Needs With Buy/Sell PTO Plans.

Sabbaticals

• iQMetrix offers a two-month paid sabbatical after seven years of service.
• Epic Systems offers a sabbatical of one month paid time off after every five years of service and subsidizes expenses when an employee (and guest) spend the time in a country he or she has never visited before.
• Basecamp offers paid sabbaticals every three years.
• Intel offers four-week paid sabbaticals every four years or eight weeks every seven years.
• Autodesk offers a paid six-week sabbatical every four years.

Next Steps

If revising your vacation policy is on your agenda, start with research into applicable leave laws and budget and administrative implications, and then consider a communications strategy. Need some help getting started with updating your vacation policy? Ask the Foundation Community, made up of International Foundation members who may be willing to share their organizations’ policies. Or submit an Information Request and let our team of Information Specialists do the research for you.

Anne Newhouse, CEBS
Information/Research Specialist at the International Foundation of Employee Benefit Plans

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