Are you thinking about introducing paid leave or reviewing your existing policy? There is a range of considerations to take into account when doing so. For example, you need to decide how to include time off in employee work schedules and how vacation pay is earned. You also need to choose whether to offer separate paid leave for sick time or a pool of paid time off (PTO) days.
One of the hardest decisions is often how many days of paid vacation to offer employees. Offering too few can affect your employee’s morale. It can also increase turnover and make you an unappealing employer in the competitive talent market.
As a starting point, it’s helpful to look at the average number of vacation days per year for American workers. In this article, we take a closer look at paid vacation leave in the US—including average vacation days per year.
What Is Paid Vacation?
Paid vacation days are days that an employee can take off from work and still get paid. Employees typically use these days to go on vacation, to rest, or for other personal reasons. The purpose of paid vacation leave generally doesn’t include sickness.
Paid vacation days are different from paid holidays. Paid holidays are specific state or national holidays that employees can take off and be paid for. Typical paid holidays include Memorial Day, Thanksgiving Day, and New Year’s Day.
There is also a difference between vacation days and paid time off. PTO is a broader term than vacation leave. Under a PTO—or a consolidated leave—plan, employers give employees a bank of paid days off for them to use as they wish.
So one employee could use their 20 days of PTO to take 10 vacation days and 10 sick days a year. Another employee could instead use theirs to take 19 vacation days and 1 sick leave day.
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Paid Vacation Leave in the US
The US is one of the few countries in the world that doesn’t require employers to offer paid time off. In fact, the US is the only OECD country without mandatory paid annual leave.
This is unusual when compared to the average paid vacation days per year in other countries.
- Egypt: Employees are entitled to 21 days of paid vacation leave.
- France: Employers must offer at least 5 weeks of paid vacation.
- Sweden: Employees receive a minimum of 25 days of paid leave.
- New Zealand: 4 weeks of paid vacation time is required by law.
- Vietnam: Employees are entitled to a minimum of 12 days of paid vacation leave.
Although it’s not a legal requirement, the majority of US employers give their employees paid vacation leave. This is typically either as a stand-alone policy or as part of a PTO policy. According to the US Bureau of Statistics, 79% of private industry workers receive paid vacation leave.
Why Include Paid Vacation Time in Your Leave Policy?
If you’re on the fence about it, there are a range of reasons why you should include paid vacation leave in your PTO policy.
Firstly, it’s essential for supporting your employee’s physical and mental health. Everyone needs a break away from work to rest and for time with their friends and family. Without adequate time off, employees are at an increased risk of burning out.
From an employee perspective, paid vacation leave is one of the most important benefits an employer can offer. In a 2020 survey by Unum, respondents identified generous paid time off as the top non-insurance benefit. Offering vacation leave helps you remain a competitive employer and attract the best candidates.
Finally, offering your employees vacation leave also benefits you as an employer. Time away from work allows your employees to rest and return to work refreshed, more productive, and more engaged. Employees are also likely to feel more loyalty to an organization that treats them well. This helps improve your employee retention rate.
What Is the Average Number of Vacation Days Per Year in the US?
According to the US Bureau of Labor Statistics, the average number of paid vacation days is 11 days. This average is based on a US employee working in the private sector, with 1 year of service. Taking weekends into account, this works out to just over 2 full weeks of vacation leave per year.
Many employers increase the paid vacation leave offered to employees the longer they are with the company. For example, in the private sector the average number of paid vacation days after 5 years of service increases to 15 days. After 10 years of service, it rises again to 17 days. For employees with 20 years of service or more, the average number of paid vacation days is 20.
The average paid vacation days per year are different for public sector employees. They also vary between industries and employer types.
Factors That Influence the Number of Vacation Days
The type of industry can influence whether or not an employee receives vacation days.
Leisure and hospitality workers are the least likely to receive paid vacation leave. Only 43% of employees in this industry receive paid vacation leave. This is compared to 95% in the manufacturing and financial activities sectors.
Larger companies are also more likely to offer their employees paid time off than small businesses. 92% of private industry workers in a business with 500 or more workers received paid vacation leave. This is compared to 71% in a business of 49 workers or less.
There are other factors you may need to consider when deciding the number of days to offer your employees for paid vacation leave. The nature of the work is one of these factors. A more intense work schedule or environment may warrant more paid vacation leave.
The average number of days your competitors offer for vacation leave is another relevant consideration.
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Do Employees Use All of Their Vacation Leave?
Regardless of how many vacation days you offer your employees, they may not use them all. According to the US Travel Association, in 2018 more than 50% of American workers had unused vacation leave—totaling 768 million days.
Reports suggest this trend is changing. But it’s still important for employers to encourage their employees to use their vacation leave.
Vacation Leave Benefits You and Your Employees
In the US, paid vacation leave is not a legal requirement. But many employers recognize the benefits of it and include paid vacation leave in their employee benefits package. As a result, the average number of vacation leave days per year for private sector employees is 11 days after 1 year of service with a company.
Choosing the number of paid vacation days to offer your employees is an important part of your PTO policy. But it’s equally essential to encourage them to use it. This way, both you and your employees can enjoy the full benefits of it.