Holiday policy tips: is your holiday policy fair?

Holidays. For many the word conjures up images of rest and relaxation. Not so the poor person responsible for managing annual leave, frantically chasing to ensure the holiday policy is adhered to and entitlements taken. But possibly the worst job of all is handling holiday clashes.

Having to refuse a holiday leave request because others are away can lead to a lot of resentment. So, most businesses try to set out a clear holiday policy for employees that everyone understands.

Often as not, this takes the form of a ‘first-come, first-served’ policy. But is this really the fairest approach for allotting holiday? There are arguments for and against.

Is a first-come, first-served holiday policy best?

Many businesses think a first-come, first-served policy is the fairest approach of them all.

As Ryan Gay, HR Advisor at HR Dept says: “Although a first-come, first-served basis seems a rather simplistic way to manage annual leave and requests, so long as it is clear what notice employees need to give for different lengths of annual leave and what is the expected turnaround time for a response to requests, there is no fairer way to manage annual leave requests should these requirements be adhered to.”

Perfecting your holiday policy procedure

The importance of managers always sticking to the correct procedure is clearly important. As Edwina Brewster, Director at Edwina Brewster HR Consulting says: “An employee might see no harm in mentioning their annual leave preference to their manager during an informal meeting and the manager might inadvertently agree (verbally) to that request.

“However, another employee might consider this was unfair if the rest of the team have followed the defined process for requesting annual leave.

“The problem would be exacerbated if the employee that had followed the correct process subsequently had their request declined in favour of the employee using the ‘informal’ route.”

Done properly, the first-come first-served approach can clearly work well. However, some businesses are now looking at systems that take a more collaborative approach.

An alternative solution to annual leave

A first-come first-served approach might be the only workable policy in a very small business which simply cannot afford for many employees to be off at one time.

However, as these businesses expand there may be more scope for flexibility.

Sarah Birkenshaw, HR Consultant at Quest Consulting Services says: “As businesses grow then holidays may be booked per team or department and so there is arguably an opportunity to consider other systems with the agreement and participation of staff, such as a rota system for key periods like school holidays or Christmas entitlement.

“This can be a big advantage for employees with children; however, this needs to be with the agreement and consent of the team so those without children do not feel disadvantaged during these periods.”

Allocating holidays as a team

Some employees may not feel the need for a rota system, but can still benefit from working together to allocate holiday between them.

As Edwina Brewster says: “A more collaborative approach where the team is relatively small is to have employees propose a calendar of annual leave for the manager to approve.

“This does rely on good communication from the manager in the first instance so that the team are made aware of anticipated periods of high demand or critical dates in the work calendar when leave will not be available or where requests are likely to be declined. But I have seen this approach work really well in medium sized teams and the result is improved employee engagement as everyone is seen to have a voice.”