At first glance, a competitive vacation package might seem like one of the most reasonable benefits you could offer your employees. After all, everyone deserves an occasional break now and then. However, what should you do when a staff member decides to take advantage of your business’s generous vacation policy and decides to use all of their paid vacation days upfront? In episode #148, Gene Marks and Elizabeth Larkin discuss how you as a small business owner should respond to an employee’s request for substantial time off.
2:11—Today’s Topic: What Should I Do When an Employee Decides To Use All Their PTO at Once?
3:23—As a small business owner, you really need to consider these kind of requests on a case by case basis because substantial time off could significantly impact the workload at your office.
4:24—While certain situations, such as a family illness or a once in a lifetime opportunity, definitely warrant consideration, your employee should still be held responsible for all their work-related obligations.
5:47—Because our current business culture places a strong emphasis on flexibility, small business owners need to be more understanding of their employees’ vacation requests.
6:36—Employers should exercise caution when they ask their staff members why they need time off.
8:08—To protect your small business, you need to have a fixed vesting policy in place regarding paid time off.
11:56—You should also consider your employee’s history before making your final decision. Employees who have been with the company longer and have a proven track record deserve priority over the newly hired.
13:06—Gene encourages small business owners to follow the current advertising trends, which predominantly favor online and social media platforms.
Elizabeth: Welcome back to the Small Biz Ahead Podcast. This is Elizabeth Larkin from The Hartford, your host, and I have permanent guest-
Gene: Gene Marks. This is Gene Marks from the Marks Group.
Elizabeth: Gene Marks, co-host. Not permanent guest.
Gene: Yes. Co-host.
Elizabeth: Gene is our small-business expert, small-business owner, and I’m just some person that sits here and talks to him about small businesses.
Gene: And that is so incorrect because you have your little side gigs going on and you know small business-
Elizabeth: I do.
Gene: And you have lots of opinions-
Elizabeth: I do. I do have a lot opinions.
Gene: On small businesses for sure. And you happen to oversee a content group that focuses on nothing else but issues related to small business. So how can you not learn?
Elizabeth: So today we have a question about vacation time and this is something that I bet drives most small business owners crazy. You don’t want your employees to go on vacation, you want them to be working all the time. Maybe some employees you’re thinking, “You know what, go on vacation.”
Gene: Actually I gotta stop you right there. You want … You need to require your employees to go on vacation every year. In fact, your financial employees has to be a requirement that they take at least a week, two weeks of vacation a year. Required. No exceptions. Because when they’re out of the office, right, that’s when if there’s any hanky-panky going on in the books, that’s how you find out, when somebody’s gone. But we don’t wanna [crosstalk].
Elizabeth: But today’s question, and we’ll get to this after we hear from our sponsor, today’s question is about someone who wants to take what I would consider to be excessive vacation and how you would handle that as a business owner. We’ll be right back after we hear from our sponsor.
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QUESTION: What should you do when an employee wants to take their full PTO in the first six weeks of the year?
Elizabeth: So today’s question is from David from Scottsdale, Arizona and he-
Gene: So first of all, if you’re from Scottsdale you’re always on vacation, right? Who lives in Scottsdale? You go to Scottsdale for conferences and it’s beautiful there and resorts, so I’m suspect of working, but okay.
Elizabeth: So he owns a warehouse, or runs a warehouse, and he asks, “What should I do when an employee wants to take their full paid vacation in the first six weeks of the year?” So I’m gonna go out on a limb because sometimes we get these questions and we don’t get a lot of background on them so we have to make stuff up but I’m guessing his employee probably gets like, what, two to three weeks of paid vacation?
Gene: He may get six, I mean, who knows?
Elizabeth: And he’s saying-
Gene: That he wants to take all of it upfront.
Elizabeth: He wants to take all of it in the first six weeks of the year. So maybe he’s gonna take a week off and then he’s gonna work for two weeks and then he’s gonna take another week off and then he’s gonna work for three weeks and whatever the math is. But it sounds like he’s saying, “I just want to take vacation January, February, and a little bit of March.
Gene: Well I have a lot of thoughts on this. First of all-
Elizabeth: I knew you would.
Gene: What do you think … At The Hartford there’s generous vacation policies, what do you think if one of your people in your group, I mean, you’re supervising a team here, and they’re like, “Hey, I wanna take a bunch of vacation right up front.”
Elizabeth: I mean, it’s not great. If you’re taking, let’s say, someone’s … For instance, I ski. So it would be ideal for me if I could take a bunch of three or four day weekends in the winter. I can’t afford to do that because I need to be in the office, but if I had someone I would work with them on that because it’s a kind of … You know, the ski season’s pretty short and if you’re only gonna be taking one day off to make it a three-day weekend, but if someone said, “I’m gonna take two weeks off and then I’m gonna work for one week and then I’m gonna take another two weeks off,” I would have an issue with that because your coworkers are depending on you, you can’t … When you’re out someone else is covering for you and I don’t think it’s great for the team.
If it was a situation where someone’s parent is sick or something like that I think that’d be different but if it’s straight vacation-
Gene: What if it was a once-in-a-lifetime … Like, “Oh, Elizabeth I got the opportunity to go Australia for three weeks,” you know what I mean?
Elizabeth: That would be fine. That would be fine. I actually did that two years ago. I went to Europe for 18 days and my boss, Dave O’Brien, who’s probably not listening-
Gene: It’s ’cause he’s busy.
Elizabeth: Yeah. He’s busy. He said, “Of course you have to do that. That’s an incredible …” And you know what I did, I did a ton of work to get ready. It was so stressful before I left because I had to line up and make sure I was getting all this work done right before I left.
Gene: It sounds like, at least, not that you’re aware, that there’s not a specific policy about that. Like in other words, it’s kind of left up to the boss. So … Which I like.
Elizabeth: Well what do you have at the Marks Group? Do you have a policy?
Gene: I do wanna … No. We have no policy that works. We’re a small business. What kind of policy do we have? We have 10 people. It’s your … But it is the same concept, Elizabeth, where you’re saying like, okay, the bosses, you’re willing to work with somebody. If it’s something special, if it’s something, you know, whatever, maybe it’s just a once … You certainly want that to be that case every year, or maybe you do want it to be every year because it’s, you can plan that out in advance. So you do it on a case-by-case basis, somebody asks for something like that.
Your first answer to me was interesting because you didn’t initially reject it. You didn’t just say, “What a jerk. No way! We got a business to run here. I’m not gonna … Whatever.” Your first answer was like, “Okay, well, I’d like to hear why,” or you know, “Maybe I can work the person on that.” Which is, guys, that’s the way we gotta be in 2019. I mean, the workforce today wants more flexibility, they do want more balance, they do wanna spend time doing fun things. It’s not all about the job.
So when somebody comes to you, first of all, initially and says, “Oh, I wanna take all my vacation in the first six weeks of the year, your first reaction can’t be some knee-jerk reaction and be like, “Forget about it!” I think you do need to-
Elizabeth: That’s my first reaction internally, though. I just … And then I would process it like, “Alright.”
Gene: Of course that’s the first reaction ’cause you’re like, “What is this?” But you do wanna … Now again, the other thing that you are kind of risking here is, you’re kinda digging into their lives a little bit, which we gotta be careful about ’cause you said to me, if it was they had a special trip to Australia or if their mother was sick or whatever. So now you’re saying like, “Oh, so I need to know a little bit more about what’s going on in your life to make that decision.” Some employees may be like, “Hey listen, it’s none of your business. I just wanna …”
Elizabeth: And it is none.
Gene: I agree. But you have to be careful about that, whether or not you’re stepping over the line. I mean, by the way, if an employee says it’s none of your business, you got every right to take a step back and say, “It’s none of business, then it’s not my business to have you take vacation the first few weeks of the year.”
I mean, in other words, if you’re gonna give a little bit, I think it’s reasonable to ask your employees to provide more information. Maybe you can work with them on doing something like that. It should be a mutually agreed kind of thing. Now … Go ahead.
Elizabeth: When I was gonna take my 18 days off to go to Europe, I approached my boss with, “Listen, this is the situation,” … I didn’t say, “I gotta take 18 days off and you can take it or leave it.”
Gene: Yeah. Nobody wants to hear that. I mean, nobody wants to hear those kinds of demands. So you hopefully that it’s a two-way street. So I guess my take-away, first of all, is that if an employee comes to you and says I’d really like to take this vacation a lot in the first, whatever, of the year, you shouldn’t knee-jerk reject it nowadays. Maybe that was something to do 20 years ago but nowadays I think you gotta hear ’em out and I think you gotta try and work along with ’em.
Having said that, you should protect yourself. You can violate your own policy, particularly if you’re a small business, but I definitely think you should have a vesting policy when it comes to vacations. In other words, if you give two weeks vacation a year to your employees, most companies I know, they award that vacation throughout the year.
Elizabeth: Yes. Yes.
Gene: So it’s not like you don’t get two weeks on day one and then that’s … So you have to have a policy … It doesn’t mean you can’t go around the policy or make an exception for it or whatever, but you should protect yourself with a policy that says you only vest … AT the very least, if the person is really being a jerk about it and say, “No! I wanna take it all!” And you’d be like, “Well you really only have two days of vacation.”
The other thing you wanna consider is policies for unpaid days off as well. Some people are willing to do that and I think if you’re willing to accept unpaid days off as well, I think that’s fine. And I think that you should, like you just did, if you’re gonna request any vacation, it’s not just in the beginning of the year, it is reasonable to ask your employees to put in those requests in advance. By in advance, I mean like a minimum 30 days in advance.
Elizabeth: Oh yeah. Definitely.
Gene: And you say oh yeah, but a lot people just don’t. They just decide they’re gonna take the time off and that’s, like you said, that’s really unfair to the other people in the company. They gotta make up the slack.
Elizabeth: So as a business owner, if someone asked you for this, I don’t know if this would cross your mind, but would think it all, “You know what, if they’re gonna take all of their vacation by March 15th-
Gene: They might leave.
Elizabeth: What kind of work are they gonna be doing in September.
Elizabeth: Do you want your employees to be able to take … I feel like …
Gene: See I don’t and the reason why is because maybe I’m too much of a softie but it’s like, you guys are big people, you’re grown-ups, so if I do agree for you take all your vacation in January, am I afraid that you’re not gonna be working as hard as September? No, ’cause I’m gonna assume that you-
Elizabeth: No, I’m talking more about burnout.
Gene: Oh, I see what you’re saying.
Elizabeth: Like the fact that I feel like people are a little better when they get back from vacation.
Gene: Yeah, but again it’s not up to me to manage. I mean, different people work at different schedules and you know, they’re not babies.
Elizabeth: Yeah, [crosstalk] manage but just to think, “Oh god, are they just gonna be so burnt out and miserable in September?”
Gene: I could ask the question, saying, “if you do this now, will you be burnt out and miserable in September or is it something …”
Elizabeth: Definitely will be burnt out and miserable.
Gene: Yeah. You might wanna take that into consideration. But I wouldn’t let that be something that would stop me because again, everybody’s big people, so I wouldn’t want to get in their way. I do … I’m big on vacation in my company. We award different levels of vacation depending on how long people have been with us. But then, I don’t even ask, I don’t track it. I mean, it’s just people. ‘Cause I know when people are there, when they’re not, plus I don’t have the time to check all that nonsense.
Elizabeth: How much vacation do you take? You haven’t taken a vacation day in years.
Gene: See that’s …
Elizabeth: You travel but you-
Gene: That’s so untrue. When people say that, it’s such baloney, I mean … I’ll tell you the reason why. In like, I’m gonna go away to Florida with my wife for a long weekend, so I’ll take-
Elizabeth: Yeah, but you’re gonna log on.
Gene: Yeah. I’ll be like … So it’s not vacation but it is vacation ’cause I’m going away to Florida. I mean, you’re gonna be at your desk during that time, you’re not on vacation, so when people say, “Oh, I don’t take vacation,” yes they do, they go on conferences, they go away, they go golfing.
Elizabeth: I’m gonna find out when you’re going away and then I’m gonna take those days off.
Gene: So I don’t, and no one asked, but I’m sure we talked about this before but particularly if you’re a business owner, I don’t think you ever should say that you’re on … You’re always on. So I don’t have an out-of-office message and I am checking my voicemail, my email all the time and I’m in contact. I don’t just switch off.
But as far as your employees are concerned, I just think that they’re, getting back to Dave’s question, if he wants this stuff all in advance because he’s got something special going on, he needs to try to work with him, if he can make it work. Vacation’s a great benefit.
Elizabeth: It also really depends on your history with this employee too.
Gene: It does. A lot of it is subjective.
Elizabeth: I know it probably shouldn’t but a lot of it is gonna be, “Well this person’s been with us five years and they’re really great employees.”
Gene: And if some other employee comes up to you and says, “How come you’re giving Dave and I asked for something similar.” “I don’t think there’s anything wrong with [inaudible], Dave’s been with us for over five years and he’s been working really hard and I think he’s earned it. Hopefully five years from you’ll have earned it too.”
Elizabeth: It’s a little trickier if it’s a new employee.
Gene: Sure. But again, everybody’s gotta, they gotta show their mettle.
Elizabeth: Okay, David, I hope we helped you a little bit with this decision. We’ll be right back with Gene’s word of brilliance.
WORD OF BRILLIANCE: Duopoly
Elizabeth: And we’re back with Gene’s word of brilliance.
Gene: So today’s word of brilliance, Elizabeth, is duopoly. The duopoly that I’m talking about is the Google-Facebook duopoly. A new … A report came out recently that said that within the next three years 50 percent of business’ spending for advertising will be spent online. More than 50 percent, which is a lot, and 80 percent right now of the online ad spending is going to Google and Facebook. 80 percent. If you add up Twitter, Microsoft, Amazon, Snap, together they’re 20 percent of the market.
So the question, like jeez, 80 percent is going to Google and Facebook, if I’m a small business, does that mean that’s it? Those are my choices that I have if I wanna advertise online? And I think as a business owner and somebody wants to advertise online, and believe me, even if you’re not selling products online, everybody’s advertising online ’cause you want your business to be found, whether you’re a restaurant or a shop or-
Elizabeth: You gotta meet people where they are and they’re online.
Gene: They’re online and their searching for … Remember, when I say that Google and Facebook makes up 80 percent, ’cause Google owns Google Maps, so if you’re like a delicatessen, you know, you wanna be showing up … That costs, you know?
Elizabeth: You always use the deli example and I always use the bakery example.
Gene: I’m a huge of delis. You like the bakeries, yeah. I like delis and you like bakeries. That’s a guy girl thing. So these Google … Instagram is a huge place that shows a lot of advertising.
Elizabeth: Well that’s Facebook.
Gene: Facebook. Yeah. It’s owned by … So they have like a big … YouTube is owned by Google so that-
Gene: And Waze. A lot of people are concerned now, people in journalism are super concerned because this ad spend is putting some publishers, really giving them a hard time. But for a business owner, the question is this: Should I be concerned? That when it comes to advertising online, my choices seem like they’re just limited to Google and Facebook.
So, the answer is yes and no.
Elizabeth: I love those answers.
Gene: First of all, you should be concerned if you’re business is a controversial business. Google and Facebook have rules about certain things, you know, adult supplements or adults products or weapons or things that … It might be a very legitimate business but Google and Facebook have their rules and those rules are gonna change and you might find yourself in a problem where you can’t even advertise online because of the nature of your business. You gotta be very, very careful about that.
So that’s one area where’s it’s a potential problem. Google and Facebook I don’ think will be the duopoly that we’re seeing today going forward because I think there’s gonna be one huge player that’s gonna intervene and that’s Amazon.
Gene: Amazon has been growing their ad business by leaps … 20 percent last year and the prediction is by a lot of experts that they’re gonna start really becoming a … Now you’ll have three big players. So consider that in the future, in you’re selling online or you’re an Amazon reseller, your dollars may not be going to Google. It might be going to Amazon because let’s face it, when I’m looking for [inaudible] food or whatever, I don’t even go to Google anymore to search that. I just go right to Amazon and search for it. Think about the power of advertising that will be there.
Gene: So just be careful in this duopoly environment if you’ve got a controversial kind of product or something that might go over their rules, you gotta be careful about that. But then number two is, don’t get too concerned with just Google and Facebook. First of all, the advertising there, they have incredible data, great demographics, if you play their game, it could be very good for you. But keep an eye on Amazon. I think that’ll be another big option.
Elizabeth: Great. Thanks so much Gene. And thanks for joining us this week. We’ll be back next week.
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