Not surprisingly, summer is known as the most popular time of the year for vacations, which may mean that you have employees eager to take their PTO, depending on your type of business.

The busy vacation time can be tricky for small businesses, particularly those running on limited staffing, as they continue to find new employees. But everyone from successful entrepreneurs to HR and mental health experts understands that it's crucial to find time away from work.

That's one reason PTO has risen in priority for some businesses in the U.S. - an increasing number of companies are adding vacation days and even offering unlimited PTO, and further, looking for ways to encourage their employees to take the time.

The trend is part of a broader effort to expand benefits to retain and attract new employees in an ongoing tight labor market.

The number of job postings that promote some version of unlimited days off nearly doubled between April 2021 and April 2022, writes Matthew Boyle in an EBN article, citing data from LinkedIn.

Big companies like LinkedIn, Netflix, Salesforce, and Hulu are already known for their flexible vacation policies. However, financial firm Goldman Sachs recently joined the ranks, reportedly implementing a policy that gives partners and managing directors unlimited vacation time.

Also, Goldman Sachs says it will start mandating that all employees take at least three weeks off each year, including at least one week of consecutive time off, reports CNBC in a story by Hugh Son.

"It reflects how competitive the jobs market has become just as companies from Wall Street to Silicon Valley are seeking to roll back workplace policies implemented during the COVID-19 pandemic," says a post by Employee Benefits News (EBN).

Why It's Important

As difficult as it may be to cover schedules and projects to accommodate vacation time, ensuring employees get time away from work is essential to their health and wellbeing, and your business.

Vacation time helps employees return to their job role more motivated and inspired, adds the community-based nonprofit Mental Health America in an article on its website. Additionally, it may reduce turnover rates and prevent burnout.

A survey by Korn Ferry showed that taking a vacation positively impacts an individual's work performance, with 80 percent of respondents sharing they had had a breakthrough work idea while relaxing on vacation.

Why Not Take PTO?   

For various reasons, your employees may not take advantage of the opportunity to get away even when they have paid vacation days at their disposal.

Historically, the U.S. work culture hasn't typically valued shorter work weeks or vacations, leading to some employees feeling they'd be judged or overlooked for pay raises or promotions if they do take time away. 

And if your business has a tight staffing schedule, some employees may feel bad about taking vacation time and leaving others with the obligation to help cover shifts.

Show Them How

One way to encourage employees to take PTO is by doing so yourself. Make time to get away from your business.  

Choosing to take a break from work and using that time to rest and recharge shows the importance placed on vacation time, explains the Mental Health America article.

Require PTO?

Some companies are starting to require employees to take PTO in the form of time away from work vs. pay.

Jeffrey Oliver, chief people officer for Honest Medical Group in Nashville, Tenn., says he understands the reasoning and agrees that it's a good idea because it shows you care about your employees' mental health.

"Requiring employees to take time off can help them feel less guilty about taking vacation time, including having to ask co-workers to cover their duties while they're away," he writes in a post for the Society for Human Resource Management (SHRM).

With mandated time off, employees no longer have to guess whether taking a vacation will be frowned upon and concerned that their taking it will reduce their chance of promotion or raise, he says. "They receive permission to do so," Oliver writes.