If paid time off from work is becoming more valuable in today's time-strapped
culture, employees aren't finding it easy to pry more of it out of corporate
America.
Employees ranked paid time off as the second most valued benefit after health
care in 2003, and among the three items they negotiate most frequently with
employers, according to recent surveys by the Society for Human Resource
Management (SHRM), an organization based in Alexandria, Va. When advising job
candidates, career counselors often say that getting more paid time off is a
cinch if employers won't budge on pay. But while you might get more paid time on
a one-time basis when starting a new job, good luck if you want it going
forward.
Most companies aren't willing to give employees extra paid time off after
their first year because it would go against established benefits policies.
Typically they won't bend even if staffers volunteer to give up pay raises in
return. "We don't do vacation-time negotiations," says Frank Ilijanic, manager
of administration and operations for Volkswagen of America in Auburn Hills,
Mich. "Vacation time is regimented by time in service, and we would be
compromising existing policy."
Companies may make exceptions during the sweet spot in job-offer
negotiations, when they'll sometimes bestow an extra week or two of paid
vacation in the first year to candidates who ask. The best time to make the
request is when a company has made an offer, but you haven't accepted. If an
employer wants you badly enough, you may have enough leverage to get a few extra
perks before you say "I do." Typically, a manager might agree to provide an
extra week or two of paid or unpaid time off on a one-time basis during the
first year to persuade you to sign on.
"If you were to say you had paid $10,000 to take a cruise to Alaska and
needed more time, negotiating that upfront might be doable on a one-time basis,"
says Mr. Ilijanic, "but the person would never get four weeks of vacation on an
ongoing basis."
More Flexibility for Executives
Securing more paid vacation time at the offer stage is easiest if you're a
senior manager. Mark Lonergan, a managing partner with Lonergan Richards
Inc., a search firm in Redwood City, Calif., estimates that about one-fourth to
one-third of recruited executives ask for and receive more paid time off than
they'd normally be entitled to from their prospective employers when negotiating
new offers. But, he adds, such candidates typically earn $225,000 or more
annually. "At more junior levels, you can't do this," says Mr. Lonergan.
Following a recession that was particularly hard on job hunters, new hires
have been glad to accept whatever vacation time they've been offered. At most
U.S. companies with traditional vacation plans, employees can accrue up to a
week's vacation time during their first year of employment. Then, after one year
of service, most employers with traditional plans (61%) provide six to 10 paid
days of vacation, while 65% up that amount to 11 to 15 days off following five
years of service, reports Watson Wyatt, a human-resources consulting firm in
Washington, D.C.
But companies and employees appear to be out of sync on how happy employees
are with the amount of paid time off they get. In a
SHRM poll taken in December, more than 80% of human-resources professionals
thought employees were satisfied with their allotted time off, but only 60% of
employees said they were satisfied.
Trading Time for Money
One way employees circumvent established company policies regarding paid time
off is to seek unpaid time off. In return for as much unpaid time off as she
needs each year, Diane Janura gave up all the paid vacation and benefits she was
entitled to at Heritage Exhibits, a Mount Prospect, Ill.-based, a display
company she joined a year ago. The 48-year-old account executive uses her time,
about four weeks annually, to take vacations with college-age children and her
husband, who has six weeks of paid time off annually.
Ms. Janura says she was able to gain the concession because her employer
appreciates the savings on her benefits costs, plus, "I am an extremely hard
worker and don't take a lunch hour," she says.
The key to securing more paid or unpaid time off is to be a top performer,
say consultants and employers. "You really have to be good at what you do," says
Alan Johnson, managing director at Johnson Associates, a New York-based
compensation-consulting firm. "If you are just mediocre, this is one more
indication that you aren't serious about your work."
Mr. Johnson says it's easier to negotiate telecommuting or flexible work
schedules than more paid time off, and family-friendly firms or small companies
with more women employees are most receptive to providing such arrangements.
Johnson Associates provides three weeks of paid vacation annually to its 10
employees, but they can take more time off or work part-time or four-days a
week. Offering these arrangements to staffers is good for morale, says Mr.
Johnson, but doing less work probably will result in a smaller performance
bonus. "People here know if they want more time off, they'll get paid less," he
says.
Employers also might be more willing to provide extra time off if they
approve of the reason employees want it, says Mr. Johnson. "If you wanted two
extra weeks off to go to Marine Corps boot camp or take a course at Harvard
University, no one will think badly of that," he says, "but there is the
old-school view that 'real people' don't need more vacation."
Adjusting the Policy
For their part, companies are moving from traditional vacation plans toward
"paid time off" or PTO plans, in which vacation, sick and personal days are
lumped into one account. In 2003, 23% of companies offered such programs, while
76% provided traditional plans that separate vacation and sick time, according
to a Watson Wyatt survey of 850 plans. Nearly half (48%) of companies with PTO
plans provided 16 to 20 paid days off after an employee has one year of service.
Employees with five years' service had 20 paid days at 65% of companies with PTO
plans.
MPC Computers LLC in Nampa, Idaho, uses a PTO plan but if employees' allotted
time isn't adequate, they can take unpaid days off without adverse consequences,
says HR vice president Susan Bundgard. About 5% to 10% of the company's 1,000
employees annually might take advantage of this rule to extend their vacations,
she says. The policy came in handy for Ms. Bundgard, who says she took an extra
two weeks of unpaid time "without my career suffering" during her first year
with the company because of her wedding plans.
A one-time exception to an established vacation policy is easier to negotiate
than a gaining an extra week or two for the length of your employment, says
Andrew J. McGill, vice president of human resources for Kennedy Health System in
Cherry Hill, N.J. Employees who plan to ask for more time should state what they
want, especially if they need only a one-time exception, he says. Also know what
benefits competitors offer and what you are willing to give up to gain your
request. "Your first question should be, 'How open is the organization to
negotiating certain aspects of the benefits plan?' " he says. "Then be prepared
to negotiate salary or other benefits down to increase another benefit."
Orvis Co. Inc., an outdoor-products company in Manchester, Vt., is willing to
consider such requests on an individual basis, says Mary Cheddie,
human-resources vice president and a member of Orvis's executive committee.
Factors to consider would be the employee's contributions and whether the job is
a good fit for him or her. Two years ago, an Orvis marketing professional
declined his annual raise because he wanted more personal time. He now has three
weeks off instead of two but gives up an annual raise each year in order to keep
the extra paid time off, says Ms. Cheddie.
Eventually, declining annual raises to gain more paid time off creates a
problem when an employee begins to feel underpaid compared to others in the same
job, she says. "At some point, the reality is going to hit," says Ms. Cheddie.