What is a Floating Holiday?
A floating holiday is a paid time off that is not hitched to any specific date, event, or occasion and is a paid day in which employees can choose to take time off according to their convenience within organizational guidelines established by the employer.
A floating holiday is an additional time off given by the employer to the employees for cultural, personal, or specific reasons that are beyond the standard leave policy of the organization and are different from regular holidays.
It is given in addition to a public holiday like Christmas or National holiday yet, few organizations allow employees to take time off or allow employees to choose their floating holidays from their listed cultural, governmental, or religious holiday lists.
Policies regarding a floating holiday vary for different organizations depending upon their workplace ethics, culture, procedures, rules, and regulations of the calendar year. Now that we have an insight into what is floating holiday, let’s know in detail about the significance a floating holiday holds.
1. What are the benefits of floating holidays?
Floating holidays have impactful benefits for employers and employees in various ways, a few of which hold prominence, are as follows:
➔ Enhances Retention
Floating holidays are a major source of strengthening employees’ relationships with the organization. It enables employees of different religious or cultural horizons to take time off apart from their standardized leaves and stay available on their local holidays or for any personal event.
It is usually noted that when employers value the individual needs and preferences of employees, they tend to stay rooted in the organization and continue with employment for a long span of time.
Furthermore, it is advantageous for employers to offer floating holidays to employees but with organized and planned policies to maintain equilibrium between the employees’ work-life so that no work gets hampered due to their absence, and they enjoy their floating holiday without any interference from work.
➔ Surges job satisfaction
A floating holiday works as an addition to the fulfillment of the employee requirements, needs, preferences, and pleasure, hence it contributes to the surging job satisfaction of employees in the company.
Floating holidays can be used as a motivational factor to enhance the concentration of employees by allowing them extra paid time off from their regular hectic schedules apart from the standard holidays.
➔ Work-Life Balance
A floating holiday is significant in enhancing the work-life balance of employees, as it gives them additional time off to avoid stress and burnout from work.
Work-life balance plays an essential role in employee’s mental health, productivity, and advancements as it directly affects the overall well-being of the organization.
In addition, offering floating holidays is also beneficial for enhancing job satisfaction of the employees as they feel valued and motivated to work and improve their efficiency, hence surging productivity. It also attract and retain valuable employees by strengthening employee connection with the company.
➔ Religious Observances
Offering floating holidays can accommodate religious observance of various festivals of employees belonging to diverse backgrounds, cultures, and traditions.
An organization encompasses diversified employees possessing different beliefs, cultures, traditions, religions, and ethos. Hence, it is impractical for the organization to accommodate every festival and offer a paid day off for each one of them.
So, to keep up with the employee’s motivation and respect for their tradition, a floating holiday can be assigned, where employees can choose their paid time off accordingly and should be scheduled and approved by the management.
A floating holiday is flexible and can be chosen by the employee as per their preferences where they can use their holidays for personal, traditional, or cultural customs which are not a part of the standardized holiday policy of the calendar year of the organization.
➔ Reduce Absenteeism
When employees get their preferred paid time off apart from the standardized holiday, they tend to remain less absent from the regular working days.
Floating holidays are conveniently scheduled by employees themselves as per their requirements, as a substitute for public holidays which motivates them to work better and be loyal to the organization which makes them feel valued.
➔ Attracts Talents
A floating holiday enhances job satisfaction in prevailing employees, which as a result enhances the reputation of the organization within the competitors in the cut-throat market.
Hence, the goodwill of the organization attracts fresh and top talents as in the present era most of the talented individuals prefer quality to quantity that is they prefer working in an organization that values their mental health, work-life balance, and job satisfaction.
It is always a great idea to include floating holidays as a benefit or perk in the job description to attract top talents and mention floating holidays per year in interviews to keep transparency with the employees during the term of employment.
➔ Legal Compliance
The legal regulations of various countries vary as per the prevailing ruling parties and constitution of the Nation.
So a floating holiday policy can help comply with certain legal rules in certain countries by abiding by the number of holidays assigned to employees and keeping an organization away from legal lawsuits.
➔ Increases Productivity
A floating holiday policy helps to achieve the retention of valuable employees as well as increases their efficiency, which comes from job satisfaction.
Floating holidays are significant in maintaining work-life balance which not only boosts employee morale to work efficiently but also helps keep them away from being exhausted from burnout and stress which ultimately elevates their productivity.
➔ Robust Employee Connection
Employee connection in an organization is of greater importance as it keeps the employees rooted in the organization and helps to attract and retain top talents in the organization’s workforce.
Offering Floating holidays is significant in enhancing employee relation to the organization as it makes employees feel valued and gives them flexibility in choosing their paid time off for their personal, local, and religious observances.
➔ Diversity and Inclusion
In a diversified organization of workforce from different geographical regions possessing different religious, cultural, and traditional beliefs, a floating holiday may be scheduled and approved to enhance inclusion in the workforce.
A diversified workforce is essential for your business for progressive advancements so it is essential that the floating holiday policy be framed accordingly to accommodate and benefit both an employee and employer.
2. What happens to unused floating holidays?
Your employees can take a floating holiday as per their preference but ever wondered, what if the floating holiday goes unused?
Unused floating holidays are subject to variance as per different company policies, procedures, and company values. It varies from one organization to another and is framed as per your company policies.
Here are a few approaches that employers can decide on for unused floating holidays:
▸ Encashment of unused floating holidays
In this employees are paid for the unused floating holiday.
If the employees do not use the floating holiday benefit that is assigned for the year, then it will be canceled and shall not be carried over to the next year.
A part of the unused floating holidays of employees are carried over to the next year. The carryover limit varies for different organizations as per their floating holiday policy.
In this, the company can convert the unused floating holiday to any other benefit such as additional vacation days or other paid time off.
In this, employees can donate their floating holidays to other employees who are in need of them due to any personal issue or crisis. They can also donate the same to charitable causes.
3. What is the difference between Floating holidays, Vacations, and PTO?