Why Time Off Management Is Important For Small to Midsize Businesses

Time off management is one of the most important responsibilities of a manager or HR team. By maintaining a well-balanced relationship between work and relaxation, you help employees have better performances and boost their morale. 

But there is a thin line between managing time off like a pro and spending all your time analyzing time-off requests, time-off records, and the company’s time-off policy. So, check out the following time off management guide to find the best practices for employee time off management and how they can help you achieve your goals.

Why Time Off Management is So Important?

First, there are several types of time off, some of which are subject to legislation. For example, companies must legally give employees paid time off for public holidays. In almost all countries around the world, companies are legally required to give employees a minimum amount of annual paid vacation days. There are other types of paid time off, such as maternity/paternity leave, jury duty or voting, the death of a family member, marriage, the birth of a child, and so on. Each country has its regulations on the subject.

Employees may also benefit from partially paid time off or unpaid time off. For example, some sick days are paid less than working hours in many countries. Companies may choose to grant unpaid time off for completing their education, attending conferences or industry-related events, family emergencies, etc.

Managing all types of time off may become a burden if you don’t do it properly. At the same time, employees appreciate a smooth and transparent time of management. They want straightforward procedures for requesting time off and fast responses. When you handle time off poorly, you are most likely to increase turnover and tell people you don’t care about their wellbeing.

Furthermore, happy and healthy employees are more productive and engaged. They trust the company and are willing to give their best. Well-rested employees are less likely to request sick days and produce leave clashes. A straightforward and efficient time-off management process will help create a positive work environment.

7 Benefits of a Clear Time Off Management Process

The time off management process is one of the pillars of the company. Do it right, and you’ll benefit in the long term. Here are the top six reasons to invest in clarifying the time-off management process from the beginning.

1. Keeps You Compliant with Labor Legislation

As a manager, you can’t negotiate compliance as it is mandatory. You can’t afford to pay fines or worse. And every mistake you make in time off management translates into troubles with the authorities. So, having well-organized and accurate records for employee time off, managing public holidays and time zones, and keeping the company compliant with labor legislation is the main benefit of a clear time-off management process.

2. Reduces Turnover

Another long-term benefit is a decrease in turnover. People value time off more than money and other perks. If you ensure a straightforward time off policy, they will most likely enjoy working for you, become more engaged, and, consequently, more loyal.

3. Reduces Absenteeism

When employees have the opportunity to relax, attend to their health, and spend time with their families, they are less likely to get sick and request time off. Furthermore, happy employees will enjoy work more and avoid unplanned absences. Overall, a good time off policy reduces absenteeism and time off costs.

4. Improves Employees’ Work-Life Balance

By providing a transparent time off policy, you encourage employees to plan their life better. They will become more responsible and organized and make better decisions. Good time off management releases employees of stress and teaches them how to self-manage for their benefit and the company. 

As each employee is different, flexibility is vital. However, if you think diversifying the time-off policy will make management more difficult, check out the HR apps and time-off management apps and see what they can do for you.

Discover the key work-life balance tips for employees.

5. Increases Productivity and Employee Engagement

Because time off is very important for the employees, providing efficient time off management works in your favor. People who feel respected and appreciated are more productive and engaged. They are willing to work overtime because they know you support them too. They are willing to plan their vacations around work tasks because they are happy at work. Overall, time-off management influences the company’s productivity, performance, and income.

6. Builds Trust

A clear and fair time off policy creates an inclusive and respectful work environment. It shows people you trust them, and, in return, they will charge the company. It is the simplest way to develop a healthy company culture.

If you want to build trust at work, we provide a list of 10 proven ways to do so.

7. Transform HR practices

When you no longer need to print paper or to get documents to be signed physically, you know you’re on the right track. However, spreadsheets are still to be handled by someone, and errors can appear. What if you don’t need both paper and manual data entry and calculations on spreadsheets? Reflect for a moment on the hurdles you face when dealing with public holidays from multiple countries, multiple types of time-off, employees working 80% of the time, or handling various employee allowances for 50+ employees. When you leverage the power of automation, your business goes to the next level, boosting employee satisfaction and transforming HR practices. 

Best Practices for Employee Time Off Management

Time off management shouldn’t be a burden. Nowadays, you can use software for most of it. If you get the principles right, everything else is a matter of putting together clear procedures and efficient communications. 

1. Record any type of time off

The possibility to create dynamic policies for each type of time off PTO, Annual leave, Vacation, Holiday, Personal day, Sick, Medical, Maternal, Bereavement, Unpaid, WFH, and even Work from Office for hybrid companies, etc.

In this way, you will ensure that the allowances are accurate, you prevent abuses, and will be able to spot absenteeism more efficiently.

Tip: Hire Specialists to Deal with Labor Legislation

Labor legislation is no joke, especially when you have offices worldwide. Hire specialists to avoid mistakes and ensure the company remains compliant with the law.

2. Use HR Apps for Managing Employee Data

HR apps safely store employee data in a well-organized manner. They provide quick and secure access both for you and for your staff. You’ll have all time-off records in one place and generate reports in no time. HR apps provide tools for browsing, searching, filtering data, sending notifications, and generating automated leave of absence reports.

3. Use Employee Self-Service for Time Off Requests

Empower employees with access to their time off records by implementing employee self-service portals. It’s a straightforward way to implement a clear time-off request procedure. With just a few clicks, employees can check their time off balance and request time off. You receive instant notifications and can approve the request in seconds. Moreover, you can delegate the approval to team leaders and department managers.

4. Keep Employees Up to Date with Changes in Time Off Policies

Managers should communicate any company’s time-off policy change to the staff. Make sure everyone receives the memo and understands the differences. Include this within your new hire onboarding process. If you use dedicated HR software, the program automatically does this task. 

Discover the 10 challenges on dealing with employee time-off management, and how automated time-off policies can help.

5. Ask for Feedback

Regardless of how innovative and modern you consider your time off policy and management, your staff may have a different opinion. Ask for feedback before implementing any change and provide training when procedures and software change. Give your team a voice and listen to your coworkers' feedback.


Time off management should be efficient and designed for the benefit of employees. Remember that a simple time-off request procedure may be more appreciated than an expensive perk. Ask for feedback and see what your employees need. Many will prefer the empowering of self-services and self-management. Make the most of HR apps and invest your time and energy in analyzing data, spotting absenteeism trends, and developing better procedures. LeaveBoard was built to help with dealing with time-off management, and the system tracks each employee's PTO entry, streamlines communication, automates repetitive processes, and much more. 

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