The Payroll Blog

News, tips, and advice for small business owners

How Much Vacation Time Should Employees Receive?

Posted On
Chris Bibey

Small business owners are faced with many challenges, including those associated with employee benefits.

There is one benefit that is discussed just as much, if not more, than the rest: vacation time.

It doesn't matter if you are hiring a new employee or trying to do the right thing for your current staff, the question of how much vacation time employees should receive is sure to come up at some point.

What's the Right Answer on Vacation Time?

Like sick days, there is no right or wrong answer regarding how much vacation time you should give employees. This is what makes a final decision so challenging.

Before you ever decide on a final number of days, there are some questions you need to answer:

  • Will employees accrue vacation days, or will you award all of them on the first day of the year?
  • Will you allow employees to carry vacation days over from one year to the next? If so, how many?
  • Have you considered the idea of offering unlimited vacation days? This sounds crazy, but some companies are moving in this direction.

Find a Happy Medium

Even though more companies are offering unlimited vacation days, it is not likely this will become the norm. For this reason, you need to find a happy medium.

At SurePayroll, we recently conducted a national survey of small business owners. We asked the following question:

  • How much paid vacation time (not including sick or personal days) do you give employees?

The Results:

  • Less than 10 days: 122 (45.7% of respondents)
  • 10 days: 80 (30% of respondents)
  • 15 days: 45 (16.9% of respondents)
  • More than 15 days: 20 (7.5% of respondents)

Judging by these results, the largest number of companies are offering employees less than 10 days of paid vacation time per year. Small business owners responding to the survey said that with a small staff, it can be a challenge to make sure not too many people are out at one time and that the needs of the business are being met.

"Since I changed to offering 10 days of paid time off for vacation or sick days, it has made managing days off much easier," one respondent said.

If nothing else, the numbers above should prove that there is no right or wrong answer to how much vacation time employees should receive. This is a decision you have to make based on your personal beliefs and company culture.