“You get these mixed signals,” Golden said. If you leave your work for a week or two, “you feel like [work] will just pile up.”
Most employees are allowed to carry over at least some time off from year-to-year. According to the BLS, 57 percent of civilian workers can carry over sick time, and about one in five can carry over an unlimited amount of it. About 55 percent of American workers can roll over at least some vacation time, but employees still end up forfeiting about 222 million vacation days a year, according to a 2016 analysis by Project Time Off, an advocacy group. Another 436 million days are carried over to future years, which means they become a financial obligation for employers.
About nine out of 10 companies pay out cash for unused vacation time when workers quit or are fired, according a 2014 survey of benefit specialists by WorldatWork, a nonprofit association of human resources professionals.
Expensive for employers
Employees accumulating huge amounts of paid leave can create problems for both themselves and their employers. Untapped vacation can become a large financial obligation that businesses must carry on their balance sheets. If workers have banked hundreds of hours of leave time, they often have just two options to unlock its value immediately: Go on months-long vacations—something likely to displease their bosses if it’s even allowed—or quit.
Whalen said a problem with vacations is the one-size-fits-all model: PTO Exchange lets employees view online the dollar value of their untapped vacation time. That can be used to book flights and lodging through a partnership with Priceline Group Inc., deposited into a 401(k) or HSA, or donated to charitable organizations. Employees can also give their paid leave to colleagues suffering from medical issues. “The benefits someone wants in their twenties might be different than those someone wants if they’re 30 or 40,” Whalen said.
His company is currently working to implement the system at its first client—a health insurer with more than 2,000 employees—and is in talks with a large retailer and several big human resource firms.
But rather than providing an advantage for employees, Penn State’s Golden warns that services such as PTO Exchange may exacerbate the underlying problem. It will provide further incentive for overworked employees to cancel vacations or go to work sick, he said: “I don’t think that’s a real positive development for our performance and productivity.”
If PTO Exchange’s clients are worried about this, Whalen said, they can tweak the plan so that only part of paid leave can be converted to benefits, forcing workers to use the rest with their toes in the sand. Toward this end, converting some time off to pay for travel could be a way for cash-strapped people to “have a good experience” instead of doing a low cost staycation, according to Whalen, who stressed that taking time off is “hugely important.”
Lucas agreed, saying PTO Exchange is “a vacation-first company.”
This article was provided by Bloomberg News.