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Inc. – How to Prevent Employee Burnout By Incentivizing Paid Time Off featuring We Are Rosie founder Stephanie Nadi Olson

by | May 30, 2022

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Originally posted by Ben Sherry on Inc., May 30, 2022.

Low morale, decreased productivity, and mass resignations are just a few of the symptoms that can stem from burnout. If the Great Resignation has taught business leaders anything, it’s that founders whose corporate culture doesn’t make employees feel valued will feel the consequences at some point.

One strategy used by employers in an attempt to mitigate burnout is providing unlimited paid time off, but a 2020 study by the Society for Human Resource Management found that when employees aren’t given a set amount of paid vacation days to “budget,” they sometimes end up taking less time off than they otherwise would. One way to ensure that your employees are taking enough time to de-stress and care for themselves is to incentivize or even mandate consistent time off.

How can you incentivize employees to take vacation time? Pay them extra to do so. At the productivity software company Evernote, one of Inc.’s 2022 Best Workplaces, employees who take five consecutive days off receive a $1,000 bonus. While many businesses will reimburse specific parts of vacation expenses, Evernotes’s policy is unique because the company will simply give employees a $1,000 bonus once they return.

“If you have a staycation and it costs you nothing, if you go camping and it costs less than $1,000, or if you go on a $10,000 dream vacation, we’re going to give you $1,000 when you get back,” says Evernote senior vice president of people Susan Stick.

Evernote also provides employees with a $1,200 annual wellness stipend. Stick says that employees have used the stipend to sign up for yoga classes or supplement subscriptions, while others have purchased workout and sporting equipment like Pelotons, canoes, and ski gear. “We have a pretty broad definition of wellness,” says Stick.

Rethinking your vacation policy can also show employees you’re thinking of them during tough times. In 2020, when Paul Copioli became CEO of the educational robotics company Sphero–another Inc. Best Workplaces honoree–the company was still getting over the sting of two recent rounds of layoffs. “Morale was really low and we were trying to figure out how we were going to retain employees,” Copioli says.

In June of 2020, the company began an experiment to see if shifting to a four-day workweek of Monday to Thursday could be sustainable. Nearly two years later, Copioli says he can’t see the company ever going back to working on Fridays.

“You actually get to use the weekend to recharge,” Copioli says. “We all sprint to the finish line on Thursday so that on Friday you can do whatever you want.”

While a four-day workweek might not be feasible for some companies, there are ways to give your workers more time off on a regular basis without losing 20 percent of the workweek. The Chicago-based software and media company Built In, which made Inc.’s 2022 Best Workplaces Editors’ List, gives its employees half-day Fridays all year round, for example.

You can also combine mandated time off while still rewarding employees for taking it, as the marketing and advertising talent firm We Are Rosie has done by tying in a mandate for employees to take off at least five days every quarter to their quarterly bonuses. The company originally offered unlimited paid time off, “but when the pandemic started we realized everyone was burned out and nobody was taking time off,” says We Are Rosie founder Stephanie Nadi Olson. “We did an analysis and realized that by giving unlimited PTO, we had inadvertently created a culture where people weren’t comfortable taking time off.”

When the company asked its workers why they weren’t taking time off, many said they “felt guilty about asking their coworkers to cover for them,” says Olson. “That guilt created a self-fulfilling prophecy where nobody was taking any vacation because everyone felt too guilty to ask someone to cover for them. By making it mandatory, we removed that guilt.”

Olson also noted that the shift in vacation policy had led to another unexpected benefit: it brought her team closer together, as the new system required employees to rely on each other. It also forced employees to get better about documenting their work and improved trust between coworkers.

“For any company that is rapidly scaling and growing,” Olson says, “I would say that this is a really smart move.”