Working Smarter

The Best Employee Retention Strategy Ever: More Vacation Time

Posted by Joe Robinson


Most companies spend a lot of time building customer loyalty and usually know what to do to get it. Yet there is a lot less attention paid to another kind of loyalty that is just as important: employee commitment, and the much less known routes that make that happen. That's a big mistake in a strong job market with a couple of generations that have well-known commitment issues. 

Take a look at these numbers from a 2018 Deloitte survey. Some 43% of millennials don’t plan to stick around for more than two years and almost two-thirds of Gen Z, 61%, want to bolt within two years. Only 28% of millennials want to be at their company five years.

This is a ticking turnover time bomb, but there is a hidden tool to stem the outflow and improve the morale of employees to such a degree that they feel so respected, they don’t think about going anywhere else: more vacation time.


Mary Miller, co-owner of Jancoa, a cleaning firm in Cincinnati, says adding a week of vacation to her two-week policy reduced a 360% turnover rate to 60% in two months and lower as time went on. “The three-week vacation has been the most successful retention program we have ever had,” Miller told me. Productivity shot up, as did sales and profits.

“We realized that, with the money we were putting out for recruiting, training, and background checks for new employees, the extra week of vacation really cost us nothing.”

Stats from the Society for Human Resource Management show that it costs 90% to 200% of an employee's salary to replace them with somebody else.

How can another week of vacation make the difference in someone staying, instead of plotting to leave? It might have something to do with the fact that researchers (Hershfield, Mogliner, Barnea) have found that people who value time more than money are happier.

Click for "The 7 Signs of Burnout"

When companies offer three weeks, for instance, over the standard one or two, it’s a perk that pays off in better work-life balance, which increases life satisfaction, and that in turn boosts job satisfaction. You need time to get recuperative benefits (two weeks to cure burnout) and go anywhere out of the country. Talk to people who have good vacation policies, three or four weeks, and they don't want to go anywhere else and lose that benefit.

People feel valued by a generous vacation policy, and that is the most important factor in employee engagement, which can result in the team working 21% harder, according to the Corporate Executive Board.


When Bart Lorang, CEO of Full Contact in Denver, Colorado, wanted to increase the appeal of his company to top software engineers so he could compete with tech hubs in California and Seattle, he decided to offer a sweetened vacation pot. Not only would he offer unlimited vacation time, but he would also give his employees a $7500 stipend to pay for their vacation. Recruitment and retention concerns solved.

The kicker on the $7500, though, is that you can only collect the money if you really take your vacation and stay unplugged the whole time you’re on it. He wants brains reset when they come back, because he knows it results in better work and fewer mistakes.

Competition for the best coders and computer geniuses in the tech world is fierce, so they have to provide serious perks to attract the top people. One of the most popular is the unlimited vacation policy. Employees can take the time they need, as long as all the work gets done. It is becoming commonplace for tech firms to adopt unlimited vacation. It attracts the best people and helps keep them there.

Millennials and Gen Z employees are particularly attuned to vacation policies. They value work-life balance and travel more than baby boomers, but they have less vacation time than boomers to take vacations. Additional vacation time goes a long way to give these two cohorts the sense they can have a life as well as a job.


The appeal of vacations may seem self-evident. Turn off stress, cure burnout (Hobfoll, Shirom), cut heart attack risk (30% in men, 50% in women who take two vacations; Brooks, Gump), relax, have fun, explore new places and foods, and live your life as fully as possible.

Yet there are deeper reasons why vacations can have a profound impact on outlook, attitude, and commitment. Humans have three core psychological needs that are paid off on a vacation like nowhere else: autonomy, competence, and connection with others.

We need to feel like we are writing our own scripts, the research of Ed Deci and Richard Ryan at the University of Rochester shows, and vacations give us that opportunity to determine the content of our lives to the max. We choose where we’re going to go, what we’re going to do.

We get from here to there using skills that make us feel competent. And we spend quality time with family and friends and make a host of new friendships that satisfy the need to connect with others. These are powerful souvenirs that make us feel intrinsically gratified. They translate to the positive outlook that we bring back to the job, and make us feel good about ourselves and the company that provides time to recreate, recharge, and discover our lives.

The energizing nature of a trip loaded with fun, positive emotions, and powerful new experiences increases productivity on return. You have more focus, and it takes less effort to get the job done. Reaction times have been shown to increase 40% after a vacation (Rosekind) and productivity along with them. Attention is the chief productivity tool, and a holiday restores it to working condition in the same way that a good night’s sleep rejuvenates an exhausted body or a charger brings your cell phone back to life. 

Ron Kelemen of the H Group in Salem, Oregon told me that he doubled his income when his company switched to more vacation time, as he took a month off himself each year to go snowboarding or visit Costa Rica. Relaxed and energized brains do more focused work.


Adding another week of vacation isn’t that hard to do. It starts with a quick change of the vacation policy. It has to be followed up, though, with organization. Employees should choose their vacation times at the beginning of the year, so that everyone knows when coverage will be needed. When holidays are figured in to the workflow and operations of the company, it all runs much more effectively than the seat-of-the-pants approach, where nothing is planned and there's no contingency for when it's time for someone to go on holiday.

Another key part of smoothly run vacations is crosstraining. Have teams learn each others’ jobs, so they can fill in when colleagues are out. This works when people are ill too. That’s what Kelemen does in his company. He says crosstraining builds incredible teamwork, since you owe your vacation to others filling in for you and vice-versa.

So the vacation strategy brings stellar teamwork, more productivity and focus and a feeling that the organization values employees’ lives. That makes you feel a part of the team, not apart from it. It's human nature that people want to stick around where they feel they belong. 

If you would like to learn more about how to cut stress and increase work-life balance for your team, and the role that time for life plays in increased productivity, please click the button below for details.

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Tags: vacations and work-life balance, vacation time, vacations and employee retention

What to Unpack Before Your Vacation

Posted by Joe Robinson


PACKING IS such sweet sorrow. As much as we want to get out of town on the long-awaited vacation, we just can’t leave it all behind. We always bring more than we need—shirts, shoes, and, especially, a stowaway that guarantees we won’t really get away, even if we go someplace else: the performance mindset.

The work mind is essential for getting things done on the job and providing achievement, but a vacation is something you don’t want to get done. The purpose of it is not an outcome or result. It’s an experience to fully immerse in. When we let the performance mindset run things on holiday, we wind up doing the vacation as if it was a job—racking up sites seen and restaurants ticked off, racing through the trip like items on the to-do list.


To enjoy and actually participate in the act of your vacation, you need a skill-set apart from your work identity, because the work mind doesn’t know how to play. It only knows outcomes, performance, external metrics. The experience of life and vacations require a different approach, participation for its own sake, which is an intrinsic goal.

Ask for no payoff, and you get a big internal one from your vacation, in the form of gratified core psychological needs such as autonomy and competence. Unlike external goals, which provide a quick bump in happiness and then fade, intrinsic goals—such as fun, enjoyment, learning, challenge, social connection—stick with us by boosting our sense of choice, effectiveness, and our social animal mandate and inform our memories with the positive events that tell us that we like our life.

So before we leave on vacation, we need to focus on unpacking a bunch of stuff first, such as the constellation of behaviors that comes with the work mind. That starts by understanding that there is value in stepping back beyond recharging brains and bodies. It requires a revaluation of time outside the office as something essential to our appointment with life. Time to live is the point of the work and is worthy in and of itself, isn't it?

You need to understand why it’s important for you to disengage from work and engage in activities that bring pleasure and happiness, not for hedonistic or materialistic reasons, but for genuine satisfaction, “I value my time,’ or ‘I’m going to do something I really enjoy,’ or ‘I’m going to be with people.’”

We need to approach the vacation as if it is one of the most important things in our world—because it is. It's your life, calling. It's essential to work-life balance and stress management, something we learn about in my work-life and stress management training programs. And it's the free-est you are going to be all year to discover, relax, and enjoy your world.

So let’s get off to the right start by making sure to check the unpacking list below before you put a single sock in the luggage.


Results Metric. It’s not about how many sites you tally on your vacation. The key to the internal rewards the science says are there for us on holiday is leaving the productivity drill sergeant at home. The whole point of the trip is the journey, not rushing through attractions to get home as soon as possible.

Stress and the Thinking about Work That Drives It. Vacations cut the risk of heart attack in men by 30% and in women who take more than one vacation a year by 50%. They do this by cutting off the source of stress and allowing our bodies and minds to repair and recuperate. The key to work recovery, as the academics call it, is psychological detachment from thoughts of work. Rumination drives the stress response, spinning a constant replay of false beliefs into what appear to be real ones. Vacations shut off that broken record—if we’re not checking work email and phone calls, that is. If you can’t resist checking in, find a vacation destination without wifi. The other thing about stress is that it suppresses the play equipment in your brain. Not much fun in store when your brain is stuck on fight-or-flight. Leave work at work.

Guilt. You worked hard for this vacation and deserve it. If you can’t enjoy yourself when you are not producing because it makes you feel guilty, you need to ask what’s wrong with this picture. What is the purpose of the work? To work? Or is it to enable what researchers say is the key goal we all have on this planet—to feel like we are writing our own script. The great psychologist Erik Erikson, who studied the life stages, says one of our central questions at the end of our days is going to be, Was it a good time? What will your answer be? 

Closedmindedness and Judging. Vacation and travel help us break out of ruts of cynicism, negativity and habitual behavior—if we are open to the change. Be receptive to new experiences and leave the critic, of yourself as well as others, at home. Stop comparing and go with what your brain neurons want more than anything else—novelty and challenge.

The Control Freak. To get the most out of your vacation, you have to give up the wheel and excess steering of events. Figure out what you want to do, but in a way that lets you roll with it and improvise too. Allow yourself the freedom to enjoy whatever happens. The best travel experiences are often the ones we didn’t plan or predict and the people we had no idea we were going to meet in places we didn't know we were going to wind up.

The To-Do List. Leave behind the pressure to accomplish an agenda, or the trip won't be successful. That’s the work mode you are trying to take a respite from. If you don’t want to do anything one morning, stay in bed and enjoy that rare pleasure. It’s your time, and you can do anything you want with it. You want to find a good balance of participant elements and carefree hours that you can use as you like. The goal should be fulfilling time, not filling time. 

The Adult Bias Against Play. Play is recognized as a critical component of health and growth in kids, but we have the idea that it’s beneath us solemn grownups because it’s nonproductive, and, therefore, frivolous. Yet play is one of the best stress buffers there is. It increases positive emotions, which crowd out the negative. Play is the ultimate intrinsic goal. It’s 100% about the experience and not the outcome. It roots us in the moment of our experience, and that means we can transcend the anxieties of the other two tenses and enjoy ourselves and the people we’re having fun with. Vacations are great opportunities to try new activities, things we haven’t done before. Play helps us grow. No matter what is happening in other parts of your life, play can help you develop new skills and offer a new form of self-expression that helps us move forward.

After unpacking your bags before you take off, you are going to feel much lighter. And happier. You won’t have a battery of judgments and to-do’s in the way of your enjoyment. You will have a wide open mandate to immerse yourself in the joy of living for its own sake and set yourself up for the right answer to Erikson’s question about whether you had a good time on this planet: OH, YEAH!

Tags: stress and vacations, intrinsic motivation, vacations and email, vacations and stress management, vacations and work-life balance, vacation tips, packing for vacation

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