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What is Paid Vacation?

Tricia Christensen
Tricia Christensen
Tricia Christensen
Tricia Christensen

Paid vacation is a benefit offered to employees that may be voluntary on the part of the company or state-mandated. The most generous paid time packages exist in the European Union. Especially where employees do not have mandated amount of paid time, amount of time given may depend on a variety of factors — not least among these is the company’s rules regarding paid vacation.

Where paid vacation exists, workers may accrue time on a weekly basis adding a certain amount of hours per week to their vacation total. Other companies give employees access to all their year's vacation time at the beginning of employment. The accrual method is more common, however. If employees are laid off during a work year, the company might have to pay them the amount of vacation time accrued, although this is not always the case. Moreover some vacation time is offered on a “use it or lose it” basis and employees may have to take the time within a certain established period or forfeit it.

Some employers offer employee a certain amount of paid vacation time on an annual basis.
Some employers offer employee a certain amount of paid vacation time on an annual basis.

A company can offer paid vacation and sick time, or they may alternately offer something called paid time off (PTO) or flexible PTO. Flexible PTO may lump vacation and sick time together so that employees can take days as needed for any reason. This can help prevent workers from calling in sick when they truly aren’t. Other examples of PTO include pay for things like serving on a jury, bereavement, or holiday pay.

Some companies will pay employees to visit conferences at tropical locations.
Some companies will pay employees to visit conferences at tropical locations.

In busy companies, paid vacation doesn’t necessarily translate to actually getting to take a vacation. Especially in countries where vacation time is a benefit and not a right, employers can frown upon people taking time off and may restrict their right to take certain times off during the year. Some companies may additionally hamper an employee’s right to choose vacation times by having things like yearly shutdowns, especially around the holidays. This is common in many factory jobs and most employees end up having to use most accrued vacation time in order to get paid while the company offers no work.

A person might take a cruise during a paid vacation.
A person might take a cruise during a paid vacation.

Some employers don’t have paid vacation but may allow employees to take unpaid leave for a specified period each year. In countries like the US, where paid vacation is not mandated, there are still some things that a company of medium to large size must allow. Employees who have worked full time for at least a year with a company can take six weeks of unpaid family leave to deal with family emergencies, births of children, or the illness of a family member, as mandated by the Family and Medical Leave Act.

Tricia Christensen
Tricia Christensen

Tricia has a Literature degree from Sonoma State University and has been a frequent SmartCapitalMind contributor for many years. She is especially passionate about reading and writing, although her other interests include medicine, art, film, history, politics, ethics, and religion. Tricia lives in Northern California and is currently working on her first novel.

Learn more...
Tricia Christensen
Tricia Christensen

Tricia has a Literature degree from Sonoma State University and has been a frequent SmartCapitalMind contributor for many years. She is especially passionate about reading and writing, although her other interests include medicine, art, film, history, politics, ethics, and religion. Tricia lives in Northern California and is currently working on her first novel.

Learn more...

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Discussion Comments

BrickBack

Greenweaver- You know I heard there's a paid vacation act of 2009 but in the works. It is a bill sponsored by Alan Grayson but it is now in committee.

This law will require employers to offer a minimum of one week paid vacation to all its employees.

While I think this it is a nice to get a company to offer this benefit, it could also hurt the company and the employee in the future. A company that absorbs the added costs often has to reduce them elsewhere.

I would hate to think that some people might be laid off, or not hired because of this potential law. While many other countries are more generous with their time off, there are also struggling financially to continue to their generous benefits.

GreenWeaver

Sunshine31-Sometimes I wish we had more vacation time. If you take a look at the paid vacation by country you will find that the United States offers the least amount of vacation time.

In France for example, their paid vacation act stipulates that all employees are entitled to six weeks of vacation per year. They feel this is necessary in order to create a balance between work and family life.

It is not common to find stores for example in Europe that close by noon on a Saturday, and are completely closed on Sunday.

Many European employees don't even work a full 40 hours like their American counterparts do so it makes sense that they would offer more vacation time than they do in the US.

sunshine31

The employee handbooks in most companies outline the paid vacation days for the standard employee.

It should include information on how the employee accrues vacation time and what the vacation policy is.

Some companies prohibit vacation during their peak season. For example, if you work in the retail sector it is almost unheard of to take a vacation during their fourth quarter Christmas season.

Most retailers make about three quarters of their profits during this time frame.

A company offers the vacation pay to the same rate that the employee would've earned had they been working. For example the average paid vacation days is about 10 or two weeks. The employee would take the time off and continue to receive a paycheck during that time frame.

Although a vacation is an employee benefit, a company has to agree to the timing of the vacation, in order to grant it.

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    • Some employers offer employee a certain amount of paid vacation time on an annual basis.
      By: Mikael Damkier
      Some employers offer employee a certain amount of paid vacation time on an annual basis.
    • Some companies will pay employees to visit conferences at tropical locations.
      By: Malbert
      Some companies will pay employees to visit conferences at tropical locations.
    • A person might take a cruise during a paid vacation.
      By: Wimbledon
      A person might take a cruise during a paid vacation.
    • Many people like to take paid vacations to visit exotic locations.
      By: spvvk
      Many people like to take paid vacations to visit exotic locations.
    • Using paid vacation time can help with job burnout.
      By: Grafvision
      Using paid vacation time can help with job burnout.
    • Paid vacation time might be taken to care for a sick child.
      By: mellsva
      Paid vacation time might be taken to care for a sick child.
    • Paid vacations are used to pursue different leisure activities.
      By: bepsphoto
      Paid vacations are used to pursue different leisure activities.
    • Paid time off might be given to someone grieving over the loss of a close family member.
      By: ckellyphoto
      Paid time off might be given to someone grieving over the loss of a close family member.
    • Companies with no paid vacation policies may still allow employees to take unpaid leave.
      By: Hemeroskopion
      Companies with no paid vacation policies may still allow employees to take unpaid leave.