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Is it time for an employee leave policy checkup?

Article-Is it time for an employee leave policy checkup?

How long has it been since you've reviewed your practice's personnel leave policies? Many cosmetic surgery practices haven't revisited leave policies in several years. Get started now with a bottom-to-top review so you'll be ready to implement any changes in 2007.

Leave time is part of the package that helps your practice compete for and keep the best employees. Make sure that your package is watertight. Inattention to details about how employees accrue leave time, who can take it when and other questions can lead to unnecessary angst and frustration. Worse, letting these details slide may raise your practice's risk of owing large payouts for unused leave time or even result in discrimination charges.


As the employer, you make the decisions about leave policy.

Except for specific situations covered by the federal Family and Medical Leave Act (FMLA) or similar rules in your state, you are free to establish when and how staff accumulate and use vacation leave. Find extensive FMLA information on the U.S. Department of Labor's Web site at http://

It is common to allow employees 10 days of leave after completing the first year of employment. It also is common for leave time to increase as the employee gains seniority. Recognizing that working a year without any days off except for weekends and holidays might be unpopular, many cosmetic surgery practices advance first-year employees limited leave perhaps five days from the following year's expected earned time. If that's your policy, make sure you also require repayment should the employee depart before earning back the borrowed leave. Repayment can come in the form of a deduction from the employee's final paycheck.


You can dole out and track vacation, sick leave and other types of leave separately.

Or you can do what many more medical practices do: Establish a paid time off (PTO) policy that combines all leave into a single pot. PTO is easier to administer and leaves less room for misinterpretation by employees. Each employee receives a set number of days off. As long as leave is pre-approved, it can be used for any purpose: illness, vacation, bereavement, whatever. PTO rewards employees who are in good health and who may never get to use much of the sick time you've allowed them to earn. But be careful about switching from a standard leave plan to a PTO arrangement if you have several long-term employees. These workers may have banked many weeks of sick leave and will expect some repayment. Consider either grandfathering them into the new scheme or work out a plan to repay them for the time they've earned.

Watch rollovers

Do you let leave time pile up with no ceiling?

That's a time bomb that could demolish short-term cash flow when a long-term employee resigns. Establish a written policy stating how much unused sick, vacation or PTO days employees may roll over into the following year. Your policy should spell out whether employees will be paid for those days and at what rate. Find out if yours is among the 30 states that limit such use-it-or-lose-it leave polices. My recommendation is to set a cap on rollover days, such as a maximum of 15 days. Then, pay the employee 50 cents on the dollar at their current wage rate for no more than 15 of the unused days. Again, check your state's labor regulations.

Without clear guidelines on stockpiling leave, resigning employees will expect you to give them full payment for that time at their current wage level. This can easily add up to thousands of dollars. It will be especially painful to fork over the money if the employee is being let go because of a productivity or attitude problem.

Demand vacations

It may sound counterproductive, but you want employees to take vacations.

A well-rested and balanced individual is ultimately more valuable to your practice than a stressed-out worker. Another reason you want employees to use earned leave time is that refusal to take any vacation is a key characteristic of the embezzler. Embezzlers don't want to leave because they don't want anyone to see what they are really up to.

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