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Business Articles

Timely and relevant business advice and news curated by the Chamber. Offering essential information, we will help you succeed and stay current.

June 18, 2018

Article of the Week

Three Reasons Your Company Should Make Vacation Mandatory

Are you one of the 52% of American workers who leaves vacation time unused? Yes? You’re not alone. It’s an epidemic amounting to 708 million unclaimed vacation days each year.

We get it: there’s always more work to be done. The pressure to meet goals can be intense, as can the concern that our absence will create more work for others while were gone, and an unbearable pile-up when we return.

But research and experience say taking time off may be the absolute best thing you can do for yourself, and your company. In fact, it’s so important, companies should require (or at least strongly suggest) employees to use their vacation time. There are three immediate benefits:

  1. It’s a good way to develop leaders within your company;
  2. It’s a good way to spot potential trouble spots before they become a crisis; and
  3. It’s incredibly good for the mental and physical health of your team members.

Let’s take those benefits one at a time.

#1: It’s a good way to develop leaders:

When senior leaders go on vacation, it gives high potential team members a chance to develop their leadership muscles. Senior leaders can make this learning possible by teeing-up an interim leader to sit in on higher level meetings, make decisions, and keep the ship afloat. This is an opportunity to express trust in an emerging leader and give them a peak behind the curtain of the next level of leadership.

When Amber was a new manager, her boss planned an extended international trip and left her as the interim director for his much larger team. He’d not even landed in Africa before Amber was over her head with a significant challenge. It took a lot of effort, but she eventually figured it out and learned a lot about leadership along the way.

Leaders who take vacation time are expressing trust in their people. They’re empowering team members to make decisions independently, which helps develop leadership capacity overall.

#2: It’s a good way to spot potential trouble spots:

Tom*, a financial analyst, always thought his company’s mandatory vacation policy was a little over the top. Sure, companies should give employees adequate vacation time. But force them to take it? That seemed too much – especially since the company locked the vacationing employee’s email account while he or she was absent.

One summer, a colleague took his mandatory time away. In his absence, Tom and his co-workers made a discovery: their trusted colleague was actively engaged in unethical financial behavior that only became evident because the vacationing colleague wasn’t able to manipulate the digital records.

This is an extreme example, but you get the point: when key players step away from work, we can find the gaps that exist in our processes before they become a crisis.

You can imagine much more benign circumstances, like team members who need a colleague to be trained as a backup for their responsibilities. Is Jane the only one who knows how to service a major account? Does anyone but Bruce know how to handle questions from senior leadership? Can anyone but Peter put the cover sheet on the TPS reports? When your MVPs take vacation time, it gives you a built-in reason to make sure your back-up processes are up-to-date.

#3: It’s good for your mental and physical health:

This may be the most important reason of all: taking vacation offers incredible health benefits. People who take regular vacations are less likely to die in the near future, have lower risk of heart disease, lower rates of depression, and experience alleviation from stress. You’ll get better sleep too, so you return to work refreshed and ready to go.

Are you ready to pack your bags?

Leaders Must Set an Example

Now that we’ve unpacked the benefits of vacation time, it’s time to make sure those vacations get scheduled. Here’s how:

  • Schedule your time away and announce it to your staff.
  • Turn off completely while you’re away and set the same expectation for your employees.
  • Encourage your employees to plan their vacation time by asking about it in your next check-in meeting.

Some things never change: taking time away will inevitably mean coming back to a full email account and a backlog of projects. But you’ll return refreshed, and with a new awareness of your team’s capacity to manage while you’re gone.

Time to pack your bags. And while you do, you might want to take one of these books from our recommended reading list.

*Name and details changed.


June 11, 2018

Article of the Week

Three Ways to Build a Better Sense of Organizational Community

Companies benefit from creating and maintaining a resilient community within the workplace. When you build community, you form an enduring foundation for your business. This foundation influences all aspects of your organization to include customer service, communication and trust. These attributes ultimately affect the success of your brand.

Building community within your organization gives you the groundwork to support human capital in a way that is not unlike reinforcing the foundation of a house. When you construct a house, you start with a base of concrete, which for your company includes the business plan and product. Within the concrete hides an added strengthener in the form of rebar. Rebar helps to fortify the concrete and maintain resiliency of the foundation. Without rebar in the foundation, a house becomes more at risk for breaks and fractures as you create the structure. 
For your organization, the behaviors of your employees and company culture become the rebar that offers this added support to the foundation of your organization.

Without an active community showcasing proper behaviors and building an ideal culture, you increase your risk of fracture within the organization. By including this second layer of reinforcement, you give more support to the company you are building. Three key behaviors help support the foundation of your business. 

1. Set behavioral expectations

Construct a clear statement of the behavior you want to see within your organization. A clear statement of response gives both employees and consumers clarity for what type of behavior the company will offer when dealing with any situation. For example, if you choose the word friendly, even when you are presented with a challenge you want to focus on actions supporting this word. Yelling at someone when you are challenged does not promote a company aiming to exhibit friendly behaviors.

To establish this behavioral foundation, choose two or three adjectives that relate to behaviors you can control, such as helpful, friendly or compassionate. These words become your personal intentional mission statement, or statement of response for how to deal with situations. Employees who align with these words help to improve your organization as they share the same behavioral values as the company and bring continuity to the actions of the organization.

The personal intentional mission statement (PIMS) names the behavior you are hoping to achieve when presented with any situation. Instead of using reactionary behavior that can often cause damage, your company’s foundation strengthens as each person within the organization maintains actions aligned with these intentional mission words.

A television commercial featuring former NFL quarterback Terry Bradshaw humorously represents what it's like to act by following intentional mission words. In the advertisement, Bradshaw opens an account at a bank and becomes “part of the family.” Bradshaw spends much of his time at the bank, encouraging both employees and customers. For example, he wishes a couple good luck as they apply for a loan and shouts joyously at a ribbon cutting ceremony. In short, he becomes a positive force at nearly all bank activities. Words such as friendly and supportive develop Bradshaw's PIMS.  

The PIMS is a way to focus your behavior on the things you can control. When you focus your actions on your PIMS words, you encourage a cycle of balanced actions, which help you keep your goals in sight. The value added to having a defined foundation of behavior includes increased trust, enhanced customer service and reduced fracturing of an organization.

2. Match your words and actions

If your PIMS identifies your company as friendly and efficient, let your mission and behaviors align with these words. Define what each word means and the behavioral expectations for reinforcing these words. You also want to match words and actions for commitments that are made, both personally and organizationally. If you commit to completing a project on time, then complete the task when designated, or communicate changes when necessary. The saying "under promise and over deliver" offers a good rule of thumb for how to keep words and actions aligned. The value added to matching words and actions includes increased authenticity and accountability for the service and support of your organization.

3. Separate human value from observational actions

There is a subtle difference between the narrative that an employee is bad at their job or an employee just did not get the work done on task. Defining the employee as good or bad drives discussions and behaviors into the past. A review of the past usually dissolves into griping sessions about a person or complaints about the situation. When you keep the focus on the observational actions, you make an environment that moves into the future. For instance, the narrative that Bob is bad at his job invites individuals to discuss Bob and his inadequacies. Whereas the story that the job wasn't completed on time encourages people to focus on ways to solve the problem, rather than focusing on Bob's shortcomings. The value added to your organization for this behavior is increased focus and forward momentum of your business.

As an example, Bonfyre App, a human resources technology business, emphasizes words such as trust, care and empathy. They have found that employees who align behaviors to these values tend to excel within the company framework. The words become actions that the employees live out in a way that does not judge situations as good or bad, or wrong or right. The reinforcer becomes the cycle of behavior. The intentional use of these words as part of the construct of the company gives this organization a little added support to the business process.

The best way to build community in organizations is to limit fractures in the life and work of your employees and your organization. The fewer fractures you create in your organization, the stronger foundation you construct. Keep these three behaviors as integral activities in your company to maintain strength and support of the structure you are building.  

June 4, 2018

Article of the Week

Unpaid Internships: What Employers Need to Know

Some observers are predicting that unpaid internships may increase now that the U.S. Department of Labor (DOL) has relaxed its intern compensation standards, but there are many questions for employers to answer before taking the unpaid route.

Legal experts tend to advise employers to pay interns as the only sure way to avoid wage and hour litigation, but they acknowledge that the unique circumstances of the internship can lead to a different decision.

"There's no right or wrong, or universal, answer," said Camille Olson, an attorney with Seyfarth Shaw in Chicago, Los Angeles and San Francisco. 

The DOL on Jan. 5 threw out a rigid, six-part test that had to be met before interns could go unpaid. In its place, the department created a "primary-beneficiary test" for determining whether interns are employees. The new test includes seven factors to consider, but each factor does not have to be met and no single factor is determinative. The criteria are designed to examine "the economic reality" of the intern-employer relationship to determine which party is the primary beneficiary of the internship. If the intern is the main beneficiary of the relationship, he or she does not have to be paid.

"The new test provides more flexibility in employers' approaches to providing unpaid opportunities, but each opportunity should be reviewed based on what the employer wants out of it and what the intern wants to get out of it," Olson said.

"While it may be easier to comply with, it's harder to interpret," said Cheryl Orr, an attorney in the San Francisco office of Drinker Biddle. "That's because there's no one overriding factor. Employers need to go through all the factors for each individual situation before making a decision to pay or not to pay."

The revised rules are meant to take into consideration that interns can reap nonmonetary benefits. Under the previous test, an unpaid intern couldn't perform any productive work, Olson explained. "It was not really beneficial to the intern at all. Unpaid interns literally had to be bystanders in the workplace. The new test changes that. Think of someone working on their journalism degree who ends up at the end of an unpaid internship at a media company with a bunch of clips. The company gets the benefit of posting the articles, and the intern gets the benefit of a byline, training and working alongside professionals in their field. But the company puts in a lot more than it gets out of the relationship."

Best Practices for Unpaid Internships

If an employer decides to offer unpaid internships, there must be clear communication and documentation that both the intern and the employer have agreed that the internship will be unpaid.

"We recommend employers get something in writing, preferably with the school as well, that lays out everybody's expectations," Orr said. "You'd want to consider having something in writing that says there will be no expectation of compensation, that the internship will be limited to a period of beneficial learning and that there is no promise of a job at the end. If you get acknowledgment of those three things in writing and you follow through on them, you will be in good shape."

Consistent, coordinated communication is key. "You want to have recruiters, interviewers, hiring managers, job advertising and marketing materials all aligned with the messaging," Olson said.

Orr added that working with a formal education program that connects the internship with the academic progression of the intern is another good idea.

"If they are in a formal education program, find out if they can get credit for the internship," Olson agreed. "If the person will get academic credit for the internship, that is very supportive of the internship being to the primary benefit of the intern."

In addition, she encouraged employers to provide "a lot of interaction and learning" during an unpaid internship, including—if resources allow—mentoring, training opportunities and even a certificate upon completion.

Know Your State and Local Laws

Some state and local laws provide different or additional types of protections to interns.

Many states follow the previous DOL regulations or have their own tests, meaning some employers will fall under the jurisdiction of the new federal test as well as labor laws adopted by their state or locality. In those cases, employers must typically follow whichever law is most generous to workers. "Often the best thing to do is call your state labor department and ask what the requirements are," Olson said.

May 29, 2018

Article of the Week

You're A Bad Listener: Here's How To Remember What People Say

Listening is hard. We come into conversations with our own agendas and low attention spans, and that can be a dangerous combination. When you’re doing the talking, though, it’s frustrating if you’re not being heard. You can build better relationships and get ahead in business if you learn how to actively listen, says Cash Nickerson, author of The Samurai Listener.

“Listening helps you handle conflict, express respect and be a better leader,” he says. “Unfortunately most people don’t remember because they don’t hear it in the first place.”

Good listeners use skills that are similar to techniques used in martial arts, says Nickerson. “A good martial artist senses what someone will do next because they’re receptive and aware,” he says. “Those are all things that great leaders and successful business people tend to do. Most people succeed based on soft skills, and communication–especially listening–is key.”

Listening involves being in the moment, which is connected to martial arts. “When you’re present and in moment, things move in slow motion,” says Nickerson. “You can take everything in. If you’re present you’ll remember everything.”

Nickerson took the act of listening apart, identifying its parts with the acronym ARE U PRESENT:

  • Awareness: Start with basic awareness. Get your face out of your phone, and stop thinking about what you’re going to do later today.
  • Reception: Be willing to receive new information. You may be present, but your mind can be closed. Let go of opinions, and be willing to drop your biases.
  • Engagement: Being engaged involves back-and-forth fairness, like a Ping-Pong match. “I talk, you talk,” says Nickerson.
  • Understanding: Listen with the intention of interpreting what the other person is saying. Get into a place of understanding, where you’re both speaking the same language, figuratively and literally.
  • Persistence: Be willing to stay the course and not let your mind wander. If you get bored and tired, push through to maintain your attention.
  • Resolution: Bring the conversation to a close with takeaways and next steps. “Leaders are doers,” says Nickerson.
  • Emotions: Respect the existence of emotions and their roles. “Emotions can work for you or against you,” says Nickerson. “Recognize their roles and learn to discern them and their effect on your ability to hear others.”
  • Senses: Employ your other senses to help you remember. Look for body language clues or even potential bluffing in the other person.
  • Ego: Try to take your ego out of the conversation. A humble leader can listen more easily because they don’t correlate their ego with success.
  • Nerves: Look for stress or tension; it can get in the way of being able to listen.
  • Tempo: Get in touch with the rhythm of the speaker. Being out of sync with their way of talking can make it hard to listen.


Listening is the basis for growth and advancement, says Nickerson. “Imagine if you went to school and didn’t pay attention to anything–how would you get better?” he asks. “Great leaders advance themselves; they’re self-improvement machines. You can’t advance your skills and knowledge without understanding others.”

Listening is also important because all people want love and respect; they want to spend time with people who listen. “Good listeners tend to get advanced and promoted,” says Nickerson. “There’s no greater feeling than when someone listens. Not just pay attention but listened.”

Recognize that listening isn’t an on/off switch. “You could say, ‘Okay, now I’m going to try really hard to listen,’ but that’s not enough,” says Nickerson. “That’s the most basic aspect of listening. Instead, strive to get the big picture and let go of your narrow focus. It’s self awareness–and a lot of biting your tongue.”

May 21, 2018

Article of the Week

Seven Steps to Developing a Replacement Plan

If there's one activity that has more of an impact than succession planning and talent pools, it's replacement planning, although the term is frequently used in conversations about succession planning. They are two different things. A replacement plan identifies "backups" for positions. Traditionally, it focuses on top-level positions, but it can be done for any key position in the organization.

Replacement planning is often mentioned in conjunction with succession planning because it identifies individuals who can assume roles at some point in the future and shows how ready they are for that role. But replacement planning doesn't have to be defined as a subset of succession planning.

Having individuals identified as backups just makes good business sense, for a variety of reasons. As much as we don't like to mention it, employees can become unexpectedly seriously ill or have an accident and be unable to work. The organization needs to find someone to take over their responsibilities—even temporarily.

A certain amount of turnover is healthy for the business, as are certain types of turnover (for example, the dismissal of a toxic employee). Since organizations don't always get to control the timing and circumstances, having a staffing backup plan (aka replacement plan), makes sense. And recruiters will want to have a say in how that plan is developed.

If your organization has a formal succession plan, you might already have replacements identified. Or it could be an added step in the existing process. For organizations using talent pools for employee development, here are seven steps that can guide a replacement planning activity:

Step 1. Identify key positions. While every job is important, certain roles within the organization would significantly impact the business if left open for a long period. According to SHRM, the average time to fill an open position is 42 days. Using that as your benchmark, which positions must be filled in less time? Ideally, we'd like every job to be filled quickly, but identify those that must be a priority. Those key positions are a place to start. You should have much of this information from your workforce plan.

Step 2. Identify the critical skills for each position. You're seeing a theme here—you've got this information from your staffing analysis. List the qualities that anyone holding this position must have. Not a wish list: Remember this is a replacement plan. If someone had the basic skills, then he or she could learn the other skills or knowledge required for the position.

Step 3. Assess the skills of current employees. Again, your staffing analysis should contain this information. If not, you can obtain it in the form of training records, performance reviews, coaching feedback, and 9-box grids. It might also be helpful to look at the skills of freelancers and consultants who currently partner with the organization or at former employees who might be interested in returning.

Step 4. Match the critical skills to the current skills of employees. This step is when organizations might be tempted to think that backup employees are currently in the department—for instance, the accounting manager is the obvious backup for the accounting director. However, a recent transfer might be interested in returning to his or her former department. Keep the planning activity focused on skills, not current job titles.

Step 5. Pay attention to jobs that don't have matches. This exercise will possibly surface some jobs that need immediate attention—meaning there is no replacement available. It's better to find out this information during a planning activity than when you're trying to fill an opening. This is why recruiting needs to be a part of the conversation so there are no surprises.

Step 6. Develop a plan to address gaps. This plan might include development programs, mentoring, coaching, and contingent staffing—or a combination of all these programs. With replacement planning, the organization doesn't have to identify a single replacement. Use talent pools to develop transferable skills for many positions.

Step 7. Evaluate the plan. On a regular basis evaluate the plan to make sure the company's needs can still be met. For key positions, the individuals currently holding those roles can be tasked with helping identify their replacement and train them. This goal could become part of their performance review.

While organizations are working hard to hire, engage, and retain the best talent, it would be naïve to think employees never leave. Replacement plans provide the organization with the comfort that a last-minute resignation, retirement, or employee illness will not leave the company disadvantaged.

Replacement plans do one other thing. They give the organization a sense of the investment they will need to make should a backup be necessary. Whether it's temporary or long term, employees asked to assume greater responsibilities need support. Regular replacement planning activities make the organization keenly aware of the support the affected employees will need to be successful.

May 14, 2018

Article of the Week

Five Emotionally Intelligent Habits For Handling Work Frustrations

Unless you lack basic social skills, it’s hard to imagine getting in trouble for expressing positive feelings at work. Sharing enthusiasm and encouragement  is usually beneficial to everyone around you. It’s the feelings on the other end of the spectrum that most of us struggle with. We’ve all gotten frustrated or overwhelmed at work.

Maybe someone less qualified gets a promotion you worked hard to earn. Or a coworker takes credit for something you did. The slackers on your team land a major project opportunity, despite the countless hours you spent working on the proposal. Or worse, the idea you submit gets rejected and criticized. These situations will make even the most even-tempered people feel angry, frustrated, disappointed, resentful, and afraid. But it’s not the situations themselves that make or break us, it’s how we respond to them. And that just takes practice. Here are five emotionally intelligent habits that can help you keep your cool.


Obviously, it’s not that easy. We feel before we think. But even a couple seconds’ buffer can make a huge difference. If you can practice giving yourself just a short moment to think about your reaction, you can gain a lot more control over what happens next. We all know people whose angry outburst has cost them their goodwill, promotions, and career opportunities, and have generally held them back in life.

Feeling a strong emotion of any kind should send you a cue: I need a second to think. If you have to remove yourself from a situation temporarily, do it. The crucial first step is simply noticing those negative feelings early enough to decide not to react just yet.


This is the logical next step. Being able to name how you’re feeling takes away some of the power our most unpleasant emotions have over us. Describing a feeling gives you some distance from it, allowing you more clarity. And chances are you can assign a name to the experience you’re having more quickly than you can choose the right response to it.


The worst thing to do is commiserate with others who hold the same grievances you do–the colleagues who will share in and urge you to hold onto your negativity. Misery loves company. While indulging in it may feel good at the time, it isn’t productive and will keep you stuck in a vicious cycle. The more emotionally intelligent approach is to find someone who’s a great listener and removed enough from the situation to offer an unbiased objective point of view. This is usually someone who has no stake in the circumstances one way or another. When explaining what happened, try to share only the data, not your opinions or feelings.


Try to look at the situation from someone on the outside looking in. Make an honest attempt to try and see things from the perspective of everyone involved. Suspend judgment if you can, and come up with as many possible explanations for what occurred as you can think of–no matter how unlikely they might seem.

This exercise is difficult, but it can help you identify alternative explanations for the situation that’s made you so upset. The tough question is, “What was my part in this–both the positive and the negative?” There may be valuable learnings in this, but at the very least, this habit gives you some time to cool off and redirect your frustration somewhere else.


Ask yourself how much this will matter to you one year, five years, or 10 years from now. Consider your long-term goals and plans and think about how this all fits in with where you want to be in the future. Is this really a battle worth fighting, or will it serve you better in the long run to let it go and move on? What will be the likely outcomes of the choices you make from this point on, and how will they help or hinder you?

Feeling upset may seem like something that happens to you–an onrush of negative emotions that you can’t control. But by practicing these techniques, you may begin to see that you still have a choice: You can’t prevent yourself from feeling aggravated, but you can often control what you do about it.

May 7, 2018

Article of the Week

What Makes Up a Small Business Credit Report?

A business credit report is an essential tool for banks, lenders, suppliers and credit grantors in assessing the creditworthiness of small businesses. The information contained in a report provides crucial details needed to make informed credit decisions.

It illustrates a company’s ability to meet its contractual obligations based on payment history and public records. The data in a small business credit report is vital to getting the funding you need to successfully run and grow a business. It impacts the following financial decisions:

  • How much business credit a supplier will extend to you
  • What repayment terms you’ll receive
  • What interest rates you’ll pay
  • How much credit or funding a bank or lender will extend to you
  • How your customers view your business
  • What insurance premiums you’ll pay

Business credit reporting agencies — such as Dun & Bradstreet, Experian Commercial, and Equifax Small Business — collect data on millions of businesses and compile the data into a business credit report. All the information collected in a company’s report is used to calculate a business’ credit rating.

The typical information that makes up a small business credit report includes:

  • Company information including number of employees, sales, ownership, and subsidiaries
  • Historical data of the business
  • Business registration details
  • Government activity summary
  • Business operational data
  • Industry classification and data
  • Public filings (liens, judgments, and UCC filings)
  • Past payment history and collections
  • Number of accounts reporting and details

Typically, all business credit reports have the same type of information. Although each business credit reporting agency has its own process for collecting and verifying data, the main data sections are pretty standard.

The first thing that displays on a small business credit report is the business profile or company information section. This section lists the company’s legal name, address, incorporation details, ownership, subsidiary details, and number of employees.

Other standard information listed in the business credit profile section includes financial data. This data includes annual sales and may include a financial statement.

The payment history section shows a company’s payment history for the past several years. This includes invoice activity, outstanding balances, payment terms, and credit limits.

The public records section lists legal filings, bankruptcies, collections, and UCC filings. If a business has legal judgments or collection accounts reporting in this section, a creditor may view the business as being in financial distress and may be hesitant to work with it.

Finally, based on the information listed in a small business credit report, each business credit agency will issue a business credit score or rating that predicts payment behavior.

Business credit reports and scores are a measure of a company’s financial stability. The main goal for small business owners should be to establish records of timely payments with all of their financial obligations in order to establish a strong business credit report and score. 

April 30, 2018

Article of the Week

How to Design a 21st Century Time-Off Program

At Moz, a software company in Seattle, employees get a paid paid vacation. That’s not a typo. In addition to receiving 21 days of standard paid time off, each employee is given $3,000 a year to spend on airfare, gas, hotels, meals, pet-sitting and other vacation-related expenses.

“We got the idea from another company and thought it would be a great way to reward our team,” says Rebecca Clements, head of HR at Moz, which has about 150 employees.

​It’s a different way of thinking about time off—as is allowing employees to “trade” traditional holidays like Christmas for days off of their choosing. That’s the approach that music-streaming company Spotify recently rolled out in an effort to recognize the cultural and religious diversity of its more than 2,000 employees. 

Both policies are a far cry from the days when two weeks’ vacation and eight fixed holidays were the norm. With tough competition for talent, a shifting legislative landscape and the most diverse workforce in generations, progressive company leaders are rethinking how to keep employees happy both inside and outside the office. In fact, last year nearly a third of organizations increased their overall benefits, which include a mix of time off, health insurance and other perks, according to the 2017 Employee Benefits research report from the Society for Human Resource Management (SHRM). And a SHRM report on 2017 holiday schedules indicates that 30 percent of employers now offer paid floating holidays other than personal days and standard holidays. 

“There’s just more openness to the fact that people need flexibility, and when they have that flexibility, they are more engaged, more productive and more likely to stay with the organization,” says Mikaela Kiner, founder and CEO of Uniquely HR, a consulting firm based in Seattle.

While there’s a generational component at play as well, that’s only part of the picture. “It does have something to do with Millennials, but I also think that all generations in the workforce are looking for more flexibility,” says Sylvia Francis, SHRM-SCP, total rewards manager for the Regional Transportation District in Denver. 

After the lean years of the recession, burned-out employees of all ages are looking to strike a better balance between work and personal time. “Boomers and Xers … want to travel or spend more time with grandkids,” Francis says.

In addition, the nature of employment is itself changing, with most people staying in jobs for 18 to 36 months. Packages that limit employees’ time off until they’ve hit a certain level of tenure don’t reflect that reality and are often a turnoff to potential employees, says Alice Chin, founder and CEO of Your Other Half, a Philadelphia-based small-business consultancy.

That’s why many organizations now offer a 15-day bank immediately, Chin says, and some are moving to unlimited vacation packages in which employees—and their managers—can decide how much time they can take while still getting their jobs done. Here are several other approaches that progressive leaders are trying.

Combined PTO Banks

A growing number of employers are switching to paid-time-off (PTO) banks that don’t differentiate between sick leave and vacation time. Data tracked by consulting firm Mercer’s annual Survey on Absence and Disability Management, a poll of more than 450 U.S. employers, found strong growth in PTO banks—63 percent of employers used them in 2015, up from 38 percent in 2010.

At the same time, new state and local laws governing sick leave could put a cap on the growth of PTO banks. California and New York City, for example, have legislation requiring employers to provide employees with a certain amount of paid sick leave. 

“I think we will see PTO bank use leveling off a bit based on what happens at the state and local levels,” says Rich Fuerstenberg, senior partner with Mercer in Princeton, N.J. Such laws do not preclude the use of PTO banks, but they do make their administration a bit more complex.

The benefits can be attractive, however: 54 percent of employers that implemented a combined PTO program said unscheduled absences dropped by up to 10 percent when they started the new policy, according to a survey by the Alexander Hamilton Institute. Four percent found that those absences dropped by more than 20 percent.

A combined policy also means less tracking for HR and obviates the need some employees may feel to “prove” when they’re sick, Francis says. 

“We made the switch because our people were not using their sick time and were complaining about not having enough time off,” says Kerry Wekelo, managing director of HR at Actualize Consulting in Reston, Va. “So we combined to a total of four weeks’ paid time off versus two weeks’ vacation and two weeks’ sick time,” Wekelo says of her 50-employee company, which offers corporate financial consulting. “Our people love this, and, even as we hire new recruits, they rave about starting at a firm with four weeks’ vacation.”

But a combined model doesn’t work for everyone. It’s often unpopular among employees who have high health care utilization needs and are thus forced to use a disproportionate share of their time off on their medical needs. Try surveying employees to see if the bundled option appeals to them, Wekelo recommends.

Something else to consider: Under many state laws, employers with a single PTO bank are required to treat accrued but unused balances as vacation pay when workers’ employment ends, says Marjory Robertson, assistant vice president and senior counsel at Sun Life Financial in Wellesley Hills, Mass.

“A potential benefit of keeping sick days and vacation days separate is that, in most states, employers are not required to pay out sick days upon termination of employment, as long as the sick days policy is clear that no such payment is owed,” Robertson says. This is true even under paid-sick-leave laws, she says, although companies may have to restore the unused balance if the employee is rehired within a specific time.

For that reason, some employers that implement PTO banks opt to give employees fewer total days than they had previously. “The reasoning behind this is that, in most cases, 100 percent of PTO is paid out at separation where sick time is usually not, so the payoff liability for employers may be greater than with a sick/vacation policy,” Francis says. 

Another issue with banked systems is that they may incentivize employees to come to work when they’re sick so they can optimize their vacation options. Offering generous short-term disability coverage or a self-insured program can help reduce the likelihood of this occurring, Robertson says. 

Forced Time Off

Research shows that people are more productive when they take breaks, yet many employees are reluctant to fully unplug because they fear doing so will put them behind. “I believe that employers are offering more time off, but I also believe that employees are more willing to work when they have time off,” Robertson says. “Technology has made it easy—some say too easy—to remain connected while away from the office.”

That’s why some leaders are finding creative ways to send a strong message to employees that vacation time should be just that.  

For example, Bart Lorange, CEO and co-founder of Denver-based software company FullContact Inc., pays his 325 employees to take a vacation. The arrangement is similar to that at Moz: Workers receive $7,500 annually after one year of employment, provided they use the funds for a vacation and agree not to connect to work while they’re off.

“The idea for the policy came from my own personal experience with going on vacation,” Lorange says. “I’ve seen people [who] take advantage of the policy come back recharged and focused, which makes for very happy, productive employees.”

There are no predetermined amounts of allowable time off, but each employee is required to take a minimum of three weeks each year. There are no accrued hours or carry-over time from one year to the next. 

“With approval, you determine when you need time away from work,” Lorange says. “There are no strings attached to this program.” 

At Moz, the only requirement employees must meet to receive their $3,000 vacation money is to spend it on time off away from home, whether it’s for a solo day trip or a multiweek family getaway. Workers can apply the money to trips taken using PTO or for weekends away, Clements says.

“There is a little admin work—gathering receipts, submitting a reimbursement request in our accounting system—but this is a widely used benefit,” she says.


At Autodesk Inc., a San Francisco-based IT company with 9,000 employees worldwide, full-time U.S. workers can take a paid six-week sabbatical every four years, says Jill McChesney, senior PR manager for the company. The time off can be used for travel, quality time with family and friends, or however else employees see fit. 

“This program is designed to give employees time away from work [so they can] return to work not only refreshed but also excited about new ideas and ready to tackle new challenges,” McChesney says.

So far, nearly every employee has taken a sabbatical, she says. The perk is offered in addition to PTO, which consists of eight hours of vacation for each complete calendar month worked.

Keeping in Time with the Law: Do’s and Don’ts 

While your company may feel like its own municipality, it still has to follow the law. For example, there are eight states and 32 jurisdictions with paid-sick-leave laws in place. Here are do’s and don’ts for staying in compliance.

DO identify any requirements regarding how sick time is tracked. Elisabeth Giammona, SHRM-CP, senior HR manager with an e-mail security startup in San Francisco, recommends asking questions such as:

  • Does such time need to be accrued, or can it be given all at once at the beginning of the year? 
  • Are there restrictions regarding how much can be used at once?
  • Are there limitations on whether it can be rolled over? 

DON’T forget to find out who’s covered. Under paid-sick-leave laws, employers must permit employees to use the leave not only for their own illnesses but also for those of covered family members, says Marjory Robertson, assistant vice president and senior counsel with Sun Life Financial.

The time can also be applied to routine medical appointments for either the employee or a family member. “Many of these state and local laws broaden the definition of covered family members beyond what the [federal Family and Medical Leave Act] requires—parent, child, spouse—to include grandparents, grandchildren, in-laws and siblings,” Robertson says.

DO consider the impact of changing paid-family-leave laws. California, New Jersey, Rhode Island, Minnesota and the District of Columbia have paid-family-leave legislation, as do San Francisco and Montgomery County, Md.

DON’T neglect federal legislation. For example, many people may not realize that the tax reform bill that was passed in December contains a paid family and medical leave provision, Robertson says. “It does not mandate that employers provide paid family and medical leave,” she explains, “but creates a tax credit for employers who provided between two and 12 weeks of paid family and medical leave that provides at least a 50 percent wage replacement benefit.” 

As a result of the shifting legislative landscape, employers of all sizes will be looking to adapt and expand their paid-time-off benefits in the near future, Robertson says.  

Floating Holidays

Although there are no laws requiring employers to provide floating holidays, some leaders are rethinking the traditional one-size-fits-all approach to paid holidays, says David Woolf, Philadelphia-based partner with the Labor and Employment Group. It’s a strategy that acknowledges the increasing diversity of today’s labor market, he says.  

“This depends on the workforce and is more common where the workforce is more diverse religiously,” Woolf says.

According to SHRM’s 2017 Employee Benefits research report, 82 percent of employers don’t permit any such exchanges and 90 percent observe the traditional holidays by closing their offices.

​Agricultural giant Monsanto offers workers one floating holiday annually, says Sue Allen, North American HR compliance lead, in addition to 13 other paid holidays. The holiday, which doesn’t carry over to the next year, can be used to celebrate Hanukkah, Ramadan, Good Friday, Kwanzaa or any other day a worker chooses.

Perhaps that’s his or her birthday. Or maybe it’s just a Tuesday. After all, for many people, having a day off can make any day a holiday.

April 23, 2018

Article of the Week

Three Sayings To Avoid When Giving Constructive Feedback

Kat Boogaard,

Dishing out constructive criticism isn’t quite as tough as being on the receiving end of it. But, let’s face it–providing that feedback can still present some challenges.

Ultimately, your goal is to correct a behavior and help that specific person become better at his or her job. And, in an ideal world, you’d be able to do so in a way that didn’t make you seem overly aggressive or condescending (while also avoiding any tears or blow-up arguments).

We all know that can be a dangerously thin tightrope to walk. Fortunately, I’m here to set you in the right direction. Stay far away from these cringe-worthy phrases when you’re offering that hard-to-hear feedback, and you’ll come off as supportive–rather than smug and superior.

1. “YOU ALWAYS . . .”

Always. It seems like such a small and innocent word, doesn’t it? It has a sneaky way of creeping into all sorts of types of feedback. But, I can’t be the only one who instantly bristles as soon as this word escapes someone’s lips.

What’s so bad about it? Well, think about what “always” actually represents: It means there’s a mistake that has happened on a frequent enough basis that you can chalk it up as something that person repeatedly does.

Maybe that’s true. However, constructive criticism is hard enough to swallow without being made to feel like you’ve been screwing the same thing up for all of eternity (and nobody bothered to let you know until this very moment).

So, do yourself a favor and skip the dreaded “a word.” It’s not doing you (or that other person) any favors.


Receiving somebody else’s input on how you could be better might be helpful–but, it can also be somewhat embarrassing. We all like to think that we’re knocking things out of the park in the office, and being told otherwise can feel disheartening.

With that in mind, the last thing you want to do is pile on the negative comments and make that person feel ganged up on or gossiped about.

Maybe other colleagues have noticed that your direct report never refills the printer’s paper tray–and they haven’t been shy about pointing it out to you.

That doesn’t mean that you need to relay the details of every single complaint when talking to that employee. In the end, it shouldn’t matter how many people have witnessed an incorrect behavior. What matters is that the person is aware that she needs to fix it.

3. “IF I WERE YOU . . .”

Constructive criticism is generally better received when it’s rooted in fact–as opposed to just opinion.

Remember, not everybody works the same way, which means that just because you’d do something differently doesn’t necessarily mean the way that other person is doing it is wrong and warrants correction.

This phrase has a way of coming off as particularly patronizing, and will likely only inspire people to tune out the rest of your feedback. When in doubt, just skip the personal judgments.

Offering constructive criticism isn’t quite as anxiety-inducing as needing to listen and implement it–but, it comes pretty close.

Fortunately, it’s more than possible to provide helpful feedback in a way that doesn’t make other people immediately cringe or roll their eyes.

Where do you start? By making sure you skip these three phrases. Do that, and you’re that much more likely to offer criticism that’s actually constructive–and not the least bit condescending.

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