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Posted on June 22, 2019June 29, 2023

Experts Advise Revising Ailing Time-Off Policies

Presenteeism

Presenteeism is heralded as a big problem in business as it’s something that can decrease an individual’s productivity or affect that of their co-workers as well.paid time off

Presenteeism, which is chiefly defined as employees who are not functioning at maximum capability due to illness, injury or another condition, could be helped if employees took time off when sick or vacation days to unwind. But the issue is not that simple. Reasons for presenteeism depend on many factors, whether it’s an individual’s attitude toward work, an employer’s workplace culture or the overall economic environment.

Employees taking time off bottomed out during the Great Recession. Over the past decade, the numbers haven’t recovered, said Steve Koepp, former Time Inc. editor and founder of From Day One, a Brooklyn-based conference series focused on creating a more collaborative, empathetic and productive workplace.

The United States is the only country without mandated vacation or sick leave. If the nation doesn’t set the tone that time off is important, it doesn’t trickle down to companies, Koepp said.

There are some things companies can do to address presenteeism, based on the reasons why employees are not taking time off.

Company Culture

Employees may face barriers to taking time off if the company has overt or subtle ways to vacation-shame employees, Koepp said. If a manager responds to a request for time off with a negative response like, “But this is the worst time,” that may have a  “chilling effect” on future requests, he said. In unhealthy workplace environments, an employee may return from a vacation only to hear from their manager that something stressful would not have happened if the employee had been at work.

“Companies should lay out some structure, and not just about the number of weeks but about how managers should handle the request, the return and everything about it,” Koepp said.

Leadership expert and coach Jack Skeen shared other ways to address presenteeism. Managers can help create an environment where people feel comfortable taking time off, perhaps by taking time off and talking to employees about how they used it.

Skeen had further suggestions for employees anxious that their career, salary or reputation could be tarnished by using paid time off. The crux of the matter is that you can’t convince people of anything if there’s not trust in the employee-management relationship, he said. That trust is key to delivering PTO-friendly messages successfully.

Skeen suggests that employers clearly and repeatedly tell employees that PTO is encouraged, supported and respected. Employers can share stories about employees who both used PTO and were promoted.

For formal vacation and sick-day policies, Skeen said that they must be fair to everyone in the company, from the frontline workers to the executives at the top. Also, employers should make sure that the policy is clear, specific and not open to excessive interpretation.

Tom Parry, president for the Integrated Benefits Institute, a nonprofit focused on research and benchmarking the link between health and productivity, agreed that trust between the employer and employee is paramount.

“Employees have to trust their employer. If they don’t trust their employer, if they have that culture that lacks trust, then you’ve got a problem [bigger than presenteeism],” he said.

Also read: Eggnog With a Splash of Paid Time Off

Given the vast number of reasons employees don’t take time off, Parry said it’s important to survey employees anonymously to determine what’s standing in the way.

Reasons to Support Time Off

The institute seeks to quantify the impact of presenteeism, Parry said. Absenteeism is visible but presenteeism often isn’t, he stressed. While managers can clearly see if an employee is not at work and estimate some business impact, it’s harder to quantify presenteeism.

IBI has done four studies with CFOs in recent years, Parry said. Conceptually, they understand the link between presenteeism and business impact. Practically, though, they won’t take action unless there’s data. 

The most important takeaway for employers is to consider the forces outside of their company, Parry said. “What happens a lot of time is we take employers out of that economic and business circumstance that they’re in,” he said.

When an employer is thinking about its individual business, long-term thinking is key alongside short-term opportunities.

“You have to be willing to bite the bullet and maybe not take advantage of every business opportunity if it’s going to have a long-term effect on your workforce,” Parry said.

Posted on October 26, 2018June 29, 2023

Voting on the Clock Works as Employee Engagement Tool

engaging employees on voting day

While voting is an important right for Americans, some employees don’t get the chance to cast a ballot because of strict workplace attendance policies.

As the 2018 midterm elections near, employee engagement and recognition company O.C. Tanner asked more than 1,000 workers around the country about their organization’s rules concerning voting during standard office hours.

In the October 2018 study, 62 percent of participants said their company allows them the flexibility to vote during the workday, and 34 percent of survey participants said their company offers its employees paid time off to vote.

O.C. Tanner Institute Vice President Gary Beckstrand said the data proves that companies aren’t tremendously supportive of their employees voting.

engaging employees on voting day
Gary Beckstrand of the O.C. Tanner Institute.

“Organizations could do a better job at allowing their employees time off to vote and express their support of the activity,” Beckstrand said.

A significant finding was how employees who were given flexibility to vote during the workday reacted. Beckstrand said employees who are given the flexibility to vote are more positively engaged.

“Employees who feel that their employers care about their overall report well-being report high feelings of well-being,” Beckstrand said. “Allowing employees time to vote is a simple way to acknowledge and support social and emotional wellness.”

According to the study, 65 percent of people say they would recommend their company to a friend as a good place to work, as opposed to the 47 percent of respondents who can’t vote during work. Also, 69 percent of participants said they want to work for their current employer a year from now, contrasting from 48 percent of respondents who can’t vote during office hours.

A 2018 Society for Human Resource Management differs from the O.C. Tanner report, citing that 44 percent of companies give paid time off to vote. While benefits can come from accommodating an employee’s civic duty, employers may be considering employee productivity issues when it comes to allowing time on the clock to go to the polls.

Dean Carter, vice president of human resources and shared services at clothing company Patagonia, said employers can use voter flexibility to their advantage, regardless of financial ramifications.

“If citizenship and democracy are part of your values, then there is no greater way to show it than to make sure your employees have time off to vote,” Carter said. “This is why we’re proud to be part of the Time to Vote [campaign], which has more than 300 companies leading a nonpartisan effort to engage in democracy and increase voter turnout.”

Workers should make sure they know their voting rights.

Employee voting rights and restrictions vary by state. In Illinois, for example, employees are allowed up to two hours’ leave if their company’s hours begin less than two hours after polls open and end less than two hours before polls close. In Michigan, it is a misdemeanor for an employer to discharge or threaten to discharge in an attempt to influence employee’s vote, according to employment law firm Constangy’s Employer’s Guide to Employee Voting Rights.

David Chasanov is a Workforce editorial associate. Comment below or email editors@workforce.com.

Posted on March 1, 1996April 13, 2020

Calculate PTO Financial Analysis and Preliminary Design

paid time off, calculate PTO

After clarifying corporate objectives (Step 1), comes financial analysis and preliminary design (Steps 2 and 3). With financial analysis, you can better determine amount of employee paid time off (PTO). The following example will help illustrate critical planning steps and answer concerns raised by companies thinking about adopting a PTO policy.

Conduct financial analysis.
Assumptions about a hypothetical company’s program are as follows:

    1. Current Annual Leave:
Account

New Employee

5-Yr. Employee

Vacation

10 days

15 days

Sick

10 days

10 days

Personal

4 days

4 days

Total

24 days

29 days

  1. Average use of sick time is six days per employee.
  2. 1,000 eligible employees receive annual paid time off.
  3. Daily wage is $100.
  4. Direct sick time costs are $600,000. [1,000 employees x $100 (average daily wage) x 6 (average sick days per employee)]. Based on experience, other costs average 10% to 25% of direct costs. Therefore true unscheduled absentee costs range from $660,000 to $750,000.
  5. Company wants to lower sick time costs by two days per employee. The result is a minimum savings of $220,000 [1,000 employees x $100 daily wage x 2 days x 10% other costs].
  6. Proposed PTO Design:
Account

New Employee

5-Yr. Employee

PTO

18 days

23 days

CAT

6 days

6 days

Total

24 days

29 days

 

Create preliminary design.
The key features of the PTO program are as follows:

  1. Total paid days are the same (a new employee receives 24 days, while a fifth-year employee receives 29). What is different is the arrangement.
  2. PTO for a new employee is 18 days (10 vacation days, four personal days and four sick days).
  3. PTO for a fifth-year employee is 23 days (15 vacation days, four personal days and four sick days).
  4. Both employees now have two fewer sick days than the average of sick days used. This is how the company caps its sick time exposure. Now, if an employee needs more than four sick days, the employee uses what was vacation time. Therefore, the employee has an incentive not to abuse paid time off. Also, using vacation time for sick time reduces the company’s future vacation payout liability.
  5. PTO rewards employees with good attendance. These employees gain up to four additional days for scheduled time off. Scheduled time off is key: Planned absences are easier to provide coverage for. With PTO, employees are encouraged to give advance notice and supervisors are more receptive to working things out with employees and granting the time off. Knowing the employee will be absent gives the manager time to make alternative plans to maintain productivity.
  6. CAT (catastrophic account) is six days for all employees.
  7. Combination of PTO and CAT is the same as under the traditional system. Both total 24 days (new employee) and 29 days (fifth-year employee).
  8. CAT provides coverage in the event an employee has a short-term illness (out for more than five consecutive work days). For example, if an employee was out because of an illness for two weeks (10 days), the first five days would be deducted from the PTO account, the balance (five days) would be deducted from the CAT account. An option is to credit PTO accounts with five days (taken from CAT accounts) because the absence was for an illness. The reason is that under a traditional system, sick time would have been used as payment. This presumes there’s sufficient time in PTO and CAT accounts.
  9. Time credited to PTO and CAT is based on an accrual system. This means if an employee is paid bi-weekly, then the employee will receive 1/26 of annual PTO and CAT hours every pay period. In essence, you work and then get paid; you work and then receive paid time off. Payroll managers report ease in using the accrual system to account for time, and in complying with FMLA.
  10. Companies cap the amount of time accrued in both PTO and CAT. The PTO cap often is 125% to 150% of the annual allotment. If the annual amount is 24 days, then the cap would be 30 days (125%) to 36 days(150%). The CAP usually is equal to the waiting period for long-term disability. Caps motivate employees to take time, and give employees a way to accumulate time for planned long vacations. Caps also place a ceiling on the company’s PTO payout liability.
  11. Unused, earned PTO time is paid out at time of termination. CAT time is not paid out.
  12. Many companies place unused, earned balance of PTO and CAT time on an employee’s pay stub. This helps ensure accuracy of recordkeeping.

Personnel Journal, March 1996, Vol. 75, No. 3, p. 117.

 

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