Employees rejoiced when the Holidays Act ushered in four weeks of annual leave in 2007.

Yet 20 years later, many are still reluctant to use their leave, and the management of outstanding leave balances remains a health and safety and finance concern. Rather than just managing the leave numbers, perhaps it’s time to consider how we can create environments that encourage regular R&R. Where it is OK to step back and recharge without feeling guilty about increasing pressure on work colleagues or letting down the boss.

If the pandemic has taught us anything about work-life balance, it’s clear that achieving seismic shifts in a short timeframe is possible. So perhaps it’s time to reignite the desire to take holidays by calling for mandatory leave to ensure that all staff feel they can enjoy a deserved break. It’s certainly something being considered in other countries.

Balsamiq, a software firm with employees in Italy, France, Germany and the US, switched to mandatory time off when managers realised workers, especially in the US, weren’t taking enough leave. “US employees, particularly certain personality types, found it hard to set aside time for vacations because there is never a ‘good’ time to do it, there is always work to be done,” says Natalie Gould, Head of People, Balsamiq. Now, the company expects workers to take a minimum of 20 days leave each year. Balsamiq does not incentivise employees to take leave, and there are no consequences for not meeting the minimum.

But vacation time is tracked, and the policy is “Enforced by nudging people into taking their time off when they aren’t seen to be doing so. This switch has had an effect on workers; it has removed guilt, uncertainty or second guessing if (taking a holiday) was really OK,” says Gould.

Unlimited paid time off (UPTO) is one revolutionary approach that some companies have considered to remove the stigma of leave taking. However, it does not seem to be the panacea some predicted.

Mathias Meyer, CEO of Travis CI, outlines why an unlimited vacation policy hasn’t worked for his company.

“When people are uncertain about how many days it’s okay to take off, you’ll see curious things happen. People will hesitate to take a vacation as they don’t want to seem like that person who’s taking the most vacation days. It’s a race to the bottom instead of a race towards a well-rested and happy team.”

In New Zealand, the upcoming review of the Holidays Act may provide the much needed opportunity to truly reimagine how we enable annual leave for the betterment of our employees, now and into the future. Indeed, given the current Act has been in force for 15 years, the proposed 2023 amendments might be the only chance we have for some time to take a different approach.

Already, under the Holidays Act, with notice and consultation, an employer can compel workers to use their annual leave. However, this sounds like a last-ditch approach rather than positive engagement about wellbeing. The benefits of a break from work are significant. They include improved physical and mental health, greater wellbeing, increased mental motivation, improved family relationships, decreased burnout and boosted happiness. What’s more, research shows that people who take holidays have lower stress, less risk of heart disease, a better outlook on life, and more motivation to achieve goals. Even planning a holiday boosts happiness up to eight weeks before the trip.

There’s much ongoing discussion in the public arena about the mental health epidemic, but as yet, little focus on the barriers to regularly taking leave to recharge our batteries.

What are your thoughts on the importance of taking holidays? Should we make it mandatory, or is more education about the health and productivity benefits of regular breaks something we could consider?

If you believe it’s time to join the debate, please share and comment on this post or drop me an email at ceo@unimed.co.nz.

Louise Zacest
Chief Executive Officer
UniMed