What challenges should I know about when designing and implementing a holiday benefit program?

Employers have several challenges when designing and implementing a holiday benefit program. Some of the major challenges include:

• Entitlement mentality. Today, many employees view holidays as something they are entitled to as a matter of right. Many employees assume incorrectly that an employer must provide holidays.

• Competition driven. Most employers, particularly those who have strong, local competition or who seek employees with highly-desirable skills, must frequently benchmark competitors policies and benefits. The holidays offered must be competitive with area practice to attract and retain workers.

• Cost. Benefits are expensive. The cost of one holiday is the cost of a day's payroll plus other costs such as lost sales. Employers should monitor all benefit costs including holidays.

• Communication. Employers must continuously reinforce the value of holiday benefits. Employees cannot know the value (much less appreciate the benefit) unless it is communicated effectively.

• Limited value. Prospective employees are often first exposed to a company's holiday policies at their initial job interview. A company with a good holiday policy is generally viewed by prospective employees as progressive, and as a good place to work. But companies should also realize that once an employee is hired, it won't be the holiday policy which the person uses to decide whether the company is in fact a good place to continue to work. Recognition, promotion, professional growth, and the like are what an employee will use to make that determination.

Therefore, employers should define the goals of the holiday benefit and a cost analysis and measure the success of the program against those goals and costs. For example, if a goal is to exceed the local competition, then the competitor's practices must be benchmarked frequently in order to determine whether or not the goal is being met. Further, employees may value other benefits more than holidays when cost considerations are factored in. Since payrolls rise every year as a general rule, the cost of a holiday always increases. Employees may rather reduce holidays in order to fund another benefit.