Whilst many of the employee benefits provided by My Benefits World can be operated with or without the online Benefits Management System (EBMS) we would strongly advocate using the BMS for this benefit. The BMS will provide the employee with a breakdown of the cost/saving of buying or selling holiday, automatically work out allocations for part-time workers and help prevent employees from dropping below minimum wage levels.
If you have employees who continually have holiday remaining at the end of each holiday year (59% of UK employees regularly do not take all of their holiday allowance) Holiday Sell would enable them to sell some of this holiday back to the company.
Holiday Buy enables employees to purchase additional holiday, with most clients granting a maximum of five days. It supports employees who may want additional annual leave for a special occasion, childcare reasons or just want an improved work-life balance. Before implementing this benefit we always advise companies to make sure it is right for their business model, for example, if you need to ensure minimum levels of resource for shift cover. It is very important from a Wellbeing perspective that employees do take holidays, therefore employees are not permitted to take themselves below statutory minimum holiday allowances, which is why five days is normally the maximum amount of holidays employees can sell. If you have employees who work on a part time basis then their holiday buy and sell will be pro-rated. You do not have to operate both holiday buy and sell, many of our clients choose to operate only one option (usually Holiday Buy).
How is it paid for?
The cost of each additional holiday purchased through Holiday Buy and Sell is calculated based on 1/260th of reference salary.
When employees choose to sell holiday the cost of the number of days they are selling back to the company is spread over 12 equal monthly additional payments into their salary. Employees will pay tax and National Insurance on this money in same way as their regular wages.
When employees choose to buy holiday the cost of the number of days they are buying from the company is spread over 12 equal monthly additional payments taken from their salary. Employees will save tax and National Insurance on this money in same way as their regular wages.
Why consider this benefit?
Whilst a quick Google search throws up a plethora of various studies which argue for and against the impact of employees taking more and less holiday on productivity, in our experience, employees really appreciate the ability to take greater control of their work-life balance. This benefit is proven to drive employee engagement in your employee benefits package. Implementing Holiday Buy for several of our clients has lead to a noticeable reduction in their sickness absenteeism (over and above year on year fluctuations). Your business will save 13.8% in Employers National Insurance contributions for every £1 of salary an employee uses to buy holiday. These NIC saving to the business can be very significant.
If your business permits employees to sell unused holiday back to the company the financial impact of this often hits at one point towards end of the start or end of the holiday year. By implementing a structured holiday sell scheme, the cost of employees selling holiday back to the company is predictably spread over 12 months.