I posted this to LinkedIn. Any ideas?
A lot of businesses need to furlough employees during the current madness, and, fortunately, unemployment compensation is very generous right now. But before an employee can get unemployment compensation, he has to burn up (or get paid for) his accrued vacation time. That doesn’t seem right. Is half the workforce going to come back from this mess with no vacation? (Everybody is going to need one!!) Surely some industry with frequent employee furloughs has figured out a better way to handle this.
How about this?
What if, rather than accruing vacation time at the company, the company paid vacation into an employee’s vacation fund. Then, when he wanted to take a vacation, he’d be on LWOP as far as the employer is concerned, but he’d pay himself from that fund.
Most companies don’t care about such distinctions. For them, it’s all cost and they are going to make sure they don’t end up on the short end of the stick. So, there’s not a strong motivation to proactively do creative things as you suggest.
I agree the practice of using vacation first isn’t fair. What’s likely to happen is there will be such a great hue and cry that progressive companies (to appease employees) will have a *special* program (for a limited period) where employees can take *some* vacation time for partial or full pay. Hopefully, I’m wrong and companies will do the right thing and fully restore all employees’ pre-pandemic vacation. We’ll see.
I’m not sure I agree that companies don’t care. When they allow employees to accrue vacation, that adds a cost to their books that hangs over their heads. It’s a liability. Paying out “vacation” in real time would alleviate some of that burden.
Also, I’m not sure this is up to the company. As I understand it, employers are required to pay out accrued vacation on a lay off, and state unemployment compensation doesn’t kick in until after that money has been used. IOW, if the employee gets $1000 in accrued vacation reimbursement, and unemployment compensation is $500 / week, the employees can’t get unemployment pay for 2 weeks.
Companies indeed have seemingly altruistic practices that require financial investment. Yet, generally, they don’t do them out of the goodness of their hearts (solely as a way to make life better for their employees). In many cases, they do them to attract talent, keep up with their competition, and/or comply with government regulations. So, they take on practices that are more expensive as a cost of doing business—it’s what it takes to operate legally and remain competitive. Yet, when they can get away with not making those investments (no required compulsion), many do…because it helps lower operating costs…even when it involves having practices that are less employee-friendly.
One annoying thing about employment practices is that many of them started during WWII in response to wage and price controls. For example, the employer paying for the employee’s health insurance. IOW, employers had a hard time attracting talent because they couldn’t raise their wages, but they could pay “benefits.”
And so, we’ve been stuck with it ever since.
I suspect some similarly stupid explanation lies behind why we do vacation the way we do.