Many employees pushed off vacation plans due to the coronavirus pandemic last year. Some companies allowed some unused days to rollover into the next year while others paid out employees for the unused time. However, the approach has remained fruitless as workers still wouldn’t take time off.
But now companies are taking out their wallets to get employees to book holidays and get away from their computers — by offering workers cash bonuses to take their vacations, a new report says.
2020 was the year of no vacation
Citing reasons like travel bans, increased pressure to work, or possible exposure to the virus, vacation-starved employees sent companies into a frenzy as they tried to adjust company policies to encourage workers to take unused paid time off.
This is why we are seeing companies take this cash-incentivized approach. The Wall Street Journal reported that some companies, including PricewaterhouseCoopers, are paying people to sign off. The accounting and consulting firm plans to offer US workers $250 for every full week of vacation booked, which could accumulate to up to $1,000 per year if employees use the time off.
“We want to show people we’re serious,” Tim Ryan, PwC’s US chairman, told The Journal. “Economic incentives do have a way of helping.”
In a post on LinkedIn, Ryan said that the initiative stems from how a company can look after its employees, perhaps now more than ever. In addition to incentivizing vacation time, PwC also announced base salary increases and expanded bonus pool, while launching the “Fridays Your Way” initiative, which will “discourage calls and meetings on Friday afternoons” this summer.
The idea of offering money to use vacation time might come as a product of workers’ hesitancy to use vacation during the pandemic, but it isn’t exactly new; even in pre-pandemic days, companies have offered workers cash or reimbursement for taking vacation.
FullContact, a marketing company, offer $7,500 in bonuses for travel after they’ve spent a year at the company.
“It sounds crazy, but we call this benefit “paid paid leave.” We give employees $7,500 so they can take the vacations they really want to take, whether that’s outside the country or within the U.S. When people come back from vacation, we hear things like, “I feel rested and ready to dive back in, and I’m excited to tackle the challenges ahead,” Michelle Warren, senior director of human resources at the company, told Employee Benefit News.
Companies have been encouraging employees to use vacation time earlier in the year due to a potential logjam during the holidays, which could prove problematic since not everyone can take vacation time.
In 2019, 768 million vacation days went unused by American workers, accumulating in $65.5 billion in lost benefits.