Annual Leave and Its Role in Business Success

Author: Eugenija Steponkute
Published: 22/11/2021
annual leave

This blog article is written for business owners and the C-Suite, addressing the issue that is the modern corporate world's approach to annual leave. The message we want to convey is that a responsible approach to employee time off won’t only be beneficial to their well-being, but also to your organisation as a whole.





The Importance of Annual Leave

When we think of a dedicated employee, we often envision a person that works relentlessly towards reaching business goals by giving the company more than what’s asked of them - including time. Often, we perceive working longer hours or not taking time off as a sign of dedication - and therefore an admirable trait.

This mindset is wrong. And in this blog, we will explain why it can be very damaging to your business.

Minimum Holiday Entitlement

In the UK, it’s a law that every employee, full-time or part-time, is entitled to a minimum of 28 paid days of annual leave. However, the statistics show that there is a big percentage of workers not utilising it. Depending on their circumstances and policies, companies can grant their staff more days of paid leave, but not less.

However, a study from Trades Union Congress (TUC) has shown that 2.2 million employees do not receive their holiday entitlement. Reasons vary from malice on the employer’s side to staff being so overwhelmed with the workload they don’t feel they can fit time off in.

Benefits of Effective Time Off Management

Even if there was no legal requirement to provide your staff with sufficient paid time off and if you’re innocent of foul play, it’s still crucial to ensure your employees get to rest. Here are the key reasons why you want to be good at managing employee time off and how to achieve it.

Minimising Burnouts

Burnouts have long since been normalised, and this is wrong. They lead to lower productivity and overall dissatisfaction with the job. Both are likely to have a negative impact on your business and office culture.

The most usual causes of burnout are frequent overtime and employees’ refusal to take time off. While you’re legally allowed to force your staff to go on annual leave (with a sufficient notice period), fighting overtime is trickier. First of all, it’s difficult to tell whether it’s a frequent occurrence or a one-off - addressing it with sufficient evidence is another issue.

To solve them both at the same time, we suggest adopting a digital solution that has both, a holiday management system and employee time tracking features. For example, Timesheet Portal. This will allow you to identify unhealthy overtime patterns and make it easier to work through them.

Healthier Work Environment

Fatigue, both mental and physical, makes staff more prone to accidents. It’s especially true in workplaces that require a lot of manual work, such as construction. For office-bound jobs, more regular opportunities to rest would reduce the stress that can otherwise translate into business mistakes and financial losses. 

Additionally, good holiday management is known to reduce days of sick leave staff takes. It’s a common issue for employees to lie about feeling unwell to have a day off - a healthy approach and system to booking time off will no longer require them to lie.

Visibility and Alignment

A centralised holiday management platform is something your entire team can benefit from. Managers will have an easier time approving or rejecting holiday requests as they will have a full view of the times ahead and will therefore be able to manage the risk of being understaffed.

For employees, having such visibility means the ability to optimise their workflows in advance. Having a system that keeps the whole organisation in the loop of who is off and when can drive massive improvements in productivity.

Claiming Holiday Entitlement Leads to Better Performance

Employee well-being is important for the simple fact they are human. Naturally, this helps to keep your staff healthy, happy and helps to minimise staff turnover. But how does it translate into improving the performance of the business?

Building Trust

It’s important that employees know their well-being is in your best interests. Approach them from a standpoint of empathy, and show them you prioritise them as individuals over the jobs they are tasked to do. Not only will this build trust over time, but also make your employees know they matter to you.

Staff that feel valued and appreciated tend to work harder. Also, aim to stay transparent with your team across all aspects of business, including holiday schedules. To create a centralised view over annual leave that’s accessible for everyone, consider Timesheet Portal as a solution.

Nurturing Inspiration

Routine is the biggest enemy of inspiration, and it tends to creep even on people in highly creative industries. Lack of inspiration prevents staff from looking for new ways to address challenges and spotting new opportunities.

Inspiration drives innovation and therefore the evolution of your business, therefore an uninspired team will be holding your growth back. Time off is what gives them a chance to unwind and come back with a fresh mind, ready to take on tasks with enthusiasm and an open mind.

Ability to Plan Ahead

As an employer, you also benefit from being hands-on when it comes to staff holidays. By having a designated system in place, you always have a full picture in front of you when dealing with incoming annual leave requests, or when trying to figure out who needs a gentle push towards claiming their minimum entitlement.

Such visibility allows you to allocate staff and resources ahead of time, therefore minimising any inconveniences that might occur due to the absence of staff on holiday. It is especially handy during holiday seasons such as winter festivities or summer breaks when most of your team will be wanting to take time off.

Is Unlimited Annual Leave the Future?

Arguably. It’s a trending approach within silicon valley companies, although we can now see it being adopted by smaller corporations too. There’s a clear appeal to this system for both, employees and employers, however, it doesn’t always work as great in practice as it does in theory.

Truth is that different businesses operate in different ways, have different structures and deal with different audiences. While it’s an optimal solution to some, it might not be anywhere near as beneficial to others for they could not sustain such an approach. Additionally, sometimes it’s the office culture that gets in a way of this initiative. In that scenario, your staff might start competing who takes less time off which will create an unhealthy rivalry that’s damaging to their performance.

Key Takeaway

Although businesses are legally obliged to give employees a minimum of 28 paid days of annual leave, the statistics show there are a lot of people not claiming their holiday entitlement. The popular opinion suggesting it shows dedication and contributes towards productivity is wrong - it’s the opposite.

Not taking time off results in poorer performance, fatigue, lack of inspiration and poorer communication. All these factors affect team morale and therefore your business directly. The solution is to ditch the mindset that your employee is dedicated when they work overtime or take no time off. And instead, nurture the culture of a healthy mindset in regards to annual leave.

It’s time we get rid of the norms that are damaging to both, people and businesses. Get in touch and we will work towards making the corporate world better. Together.

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Timesheet Portal online software provided by Anfold Software Ltd, a registered company in the UK.