Get smart with annual leave

Become a holiday-friendly workplace

We all know that taking a break to recharge is important for our work/life balance, but the reality is that Australians aren’t taking enough annual leave.

And this can negatively impact not only our personal health, but also your business’ bottom line.

The facts

Over eight in every 10 Australians are intending to take a holiday sometime in the next 12 months, but the latest statistics show that the more annual leave an employee has accrued, the less likely they are to have plans to use it.

On average, Australians have 16 days of unused annual leave owing while more than one-third have four or more weeks accrued.

Research also reveals that Australia’s paid workforce has gained over 133 million days of accrued annual leave.1

Risk of excessive leave accruals

The more leave accrued by employees, the costlier it gets for employers.

Annual leave accumulates in terms of hours, not a fixed dollar value. So, when employees eventually take their leave, it may be at a higher pay rate. There’s also the financial liability on the balance sheet.

Plus, not taking a break from work can lead employees to becoming more stressed, tired and unproductive. Working to excess can then result in increased absenteeism and sick leave.

Tips to encourage leave

  1. Promote the benefits of taking a break:
    • Eliminate stress and return to work refreshed and reenergised
    • Spend quality time with loved ones
    • Enjoy new experiences away from the confines of the office.
  2. Emphasise that work can be divided among team members in their absence so it won’t be chaos on their return.
  3. Make leave planning a permanent agenda item. Remind employees that busy periods such as summer holidays tend to book up fast so it’s best to get leave requests in early.
  4. Lead by example and ensure your senior managers and executives take their leave entitlements.
  5. Run an incentive for employees to reduce their leave accruals and win a prize or holiday.

A handy resource for employers is Tourism Australia’s campaign No Leave, No Life2, which provides a series of modules and practical case studies to help address the challenges of stockpiled leave.

Together with these tips, employers will now be able to direct employees to take annual leave if they have accrued an excessive amount, thanks to a recent ruling by the Fair Work Commission (FWC).3

A fresh start for your business

With the new financial year just around the corner, make sure your workplace is ‘holiday-friendly’ and encourage your employees to embrace annual leave.

“Holidays help to build positive morale, which results in increased motivation in the workplace, making it a better place for everyone. A productive work force will ultimately drive the success of your business.” Andrew McEvoy, Managing Director, Tourism Australia4

Please note: Business owners and employers should make sure they are familiar with the National Employment Standards5 under the Fair Work legislation, which stipulates all arrangements relating to annual leave.

 

1 http://www.roymorgan.com/findings/6974-holidays-waiting-to-happen-australian-workers-134million-days-annual-leave-201609200934

2 http://www.tourism.australia.com/en/about/our-campaigns/past-campaigns/no-leave-no-life.html

3 https://www.fwc.gov.au/awards-agreements/awards/modern-awards/modern-awards-fact-sheets/excessive-annual-leave-accruals

4 http://www.tourism.australia.com/campaigns/no-leave-no-life/tools-and-templates.aspx

5 https://www.fairwork.gov.au/employee-entitlements/national-employment-standards

Important information

Show more

© AMP Life Limited. This provides general information and hasn’t taken your circumstances into account. It’s important to consider your particular circumstances before deciding what’s right for you. Although the information is from sources considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decision. Except where liability under any statute cannot be excluded, AMP does not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.