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How to manage vacations (high level): Let me show you how to start the new year off right. Seeing the big picture will help you decide how to manage from now to December 31st. Just remember, January you’re making a fresh start.
Note – This will need to be presented and discussed at a team meeting so everyone has plenty of notice before the new year. For some this new system may ruffle feathers, after having a free-for-all for so long.
Ingredients for a Turnkey System:
- Structures Under Development, new worksheet titled “2024 Vacations” to manage January to December calendar year. Each calendar year has its own worksheet.
- You will need a corresponding calendar to “see” time off and ensure the company is not caught short with too many people off at once. Either a shared calendar that shows nothing but vacations and time off OR create a static calendar inside the worksheet itself (by copying monthly format from editorial calendar to jump start the process). Which you choose is a personal preference. LMK.
- You’ll need a Vacation & Time Off Request Form so people have a mechanism to ask for time off (from-to dates, reason (categories correspond with types of time off listed in Employee Handbook). Do you have one already?
- Managing expectations. You’ll need to explain vacation entitlement and time off in the Employee Handbook, along with how to ask (fill out the form giving reasonable notice, submit to your manager for approval), and what to expect (not everyone can be away at the same time, so how will each request be considered?). Employment equity is achieved in company policy that treats everyone the same. Once you see and understand the “turnkey system” you can edit the Employee Handbook accordingly.
Setting Up the Structure
Use one spreadsheet to track the entire team over one calendar year. Names go in Column A.
Column B is Tenure. Three classifications to choose from in a drop down list: Less than 12 months (vacation entitlement comes into effect after 1 year of employment); 1-5 years; over 5 years.
Column C Entitlement is auto-populated with a formula based on tenure: < 1 yr = 0, 1-5 yrs I recommend 10 days, >5 yrs I recommend 3 weeks. This will allocate each person’s annual vacation allowance. It’s like a bank account you manage for them that they can make withdrawals from. Goal is to draw down to zero by the end of each year and start again with a clean slate.
Paid statutory holidays are additional days off and are not counted as vacation days. I don’t know how many Michigan specifies.
Nicely done. Something is missing that would enable the ledger to draw down with each request for time off. Maybe each employee has her own tab that carries on year to year. I don’t want you to spend more time on this until we are all on the same page. Let’s talk Tuesday…unless you have a comment to respond to the video I sent.
- Approved time off needs to be visible to everyone so people can manage their own workflows and colleague interactions accordingly.
- Whose responsibility is it to update the calendar to show approved time off, the employee’s or the manager’s? If you make it the employee’s, this needs to be added to strategic responsibilities. If manager it needs to be listed under day-to-day responsibilities.
- What if someone who’s worked there for six months needs three days off?
- You’ll need to address how exceptions are addressed. This takes more thought and discussion. What if someone wins the lottery and wants to book a round the world cruise? I suggest the “entitlement” portion be paid time off and the rest is an unpaid leave of absence. But the company has the right to refuse unpaid requests for time off as an “imbalance” can be detrimental to both performance and culture. Best to run some fun ‘what if…?’ scenarios and let the data speak to you. The data in this case is the consistency by which you reach decisions for each scenario. A common theme will emerge. Whatever THAT is will become “EBLI’s way”.
- See how your systems save you TONS OF TIME AND HEADACHES throughout the year? You make a bunch of reasonable decisions all at once, so you can focus on clients, partners and continuous improvement.
My recommendations are based on BC law. I refer to it only because it occurs to me that Nora wants to be extra generous and BC law is the most generous in Canada. For this reason I can give you examples of how it works.
For example, employees must receive at least 4% of their total wages for vacation pay (1-5 years employed). In other words, if you don’t want to offer paid time off AT ALL, you would pay an additional 4% of their gross pay on each check. Over 5 years employment is 6% or three weeks of paid vacation. An employee is entitled to two weeks’ vacation after completion of their first year of employment.
I can even share this funky little calculator to help you calculate vacation owed at termination: