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Why taking your holiday is good for business

Author: ICAEW Insights

Published: 01 Aug 2022

Summer holidays may be in full swing, but there’s always someone who doesn’t use their full annual leave allowance. Nic Marks explains why taking a break is vital, for you and your team.

Leading a team isn’t easy. It can often feel like a juggling act between getting the work done and keeping the team happy – all while trying to practise what you preach. The good news is that research shows happier teams are more productive and outperform peers by more than 20%.

The fact that happiness is a hidden driver of productivity is especially important when you, as a leader, are thinking about annual leave and holidays. The majority of Brits do not take their full annual leave allocation. This has been true both before and during the pandemic, with recent research suggesting that only 43% of people take 90% or more of their entitled allowance. 

One would imagine that everyone wants to take all their holidays, but there are lots of reasons why people don’t, including feeling guilty or worried about letting the team down. At face value, this is supportive. However, sometimes we imagine we’re replaceable and worry that we won’t be missed!

It’s in your best interest

In the UK, most businesses offer between 20 and 30 days a year – about 10% of days worked in a year. When you think that happy teams are at least 20% more productive, it is obvious that people taking time off can return refreshed and happier. There are other positives, too.

  • Covering for a colleague enables team members to broaden their experience and skills. Not only does it build professional empathy, it is also very useful when other inevitable disruptions occur during the year.
  • Reciprocity is at the heart of all relationships. If a company respects that its employees have a life outside of work, this will be repaid with more loyalty and engagement.
  • Collaboration is a sign that teams are working well together. Team members being away ensures that critical activities don’t get stuck with one person and are shared around, building resilience and agility.

Taken together, this demonstrates why holidays are important and why senior leaders need to actively promote them, to ensure that the individual and the wider team function better. It is short-sighted to think of those untaken days as a bonus to the business. They are, instead, an indicator of future inefficiencies.

Take the work/life balance seriously

There are three easy things that every team leader can do:

  • keep track of how much holiday everyone has taken and ensure your whole team takes at least 90% of their days (100% can be hard to hit);
  • take your own holidays – leading by example is always important; and
  • refrain from contacting colleagues when they are away. Make sure they put their out-of-office message on and don’t idly copy them into emails, otherwise their inbox will be overflowing when they get back.

If you want to do more, there are some inspiring examples of what progressive businesses do. An American tech company gives people ‘paid, paid’ leave. Every year, it pays for its employees’ two-week holiday. Now, this is in the US, where tech businesses are often flush with cash, but it’s an interesting idea. The CEO’s logic was that people often don’t save enough for holidays and he wanted them to really enjoy their time off. While I’m not suggesting that you pay your team members £7,000 to go on holiday, you could give them £200 to take their family out for a special day. This is precisely the type of small perk that is well received.

Another business had a similar idea, where staff were paid a $2,000 bonus if they didn’t check their work emails while away. And yet another has created a self-destructing, James Bond-style out-of-office email system, where the sender gets a message that the recipient is out of the office and who they can contact in the meantime. It then informs them that their email will now be deleted. 

So, while leading a team isn’t always easy, making sure everyone goes on holiday is one of the easiest things to do. Not only will your team be happier, and more productive, they will also appreciate your role in making holidays happen.

Nic Marks, happiness expert, award-winning statistician and TED speaker and CEO of Friday Pulse™

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