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Crafting an Inclusive Holiday Policy

Group of diverse coworkers.

Quick look: The American workforce is the most diverse it’s ever been, and it’s time for employers to revise their company calendars to match that. A properly planned inclusive holiday policy can help employees feel valued and respected, while also helping employers recruit talent, retain staff, and strengthen diversity, equity, and inclusion (DEI) within their organization. Here’s what business leaders should keep in mind as they revisit their holiday schedules.

Today’s workforce is more diverse than ever. According to data from the U.S. Bureau of Labor Statistics, the share of non-white workers increased from 11.7% in 1979 to 22.3% in 2019. As the labor force continues to diversify, it’s vital that all employees feel they work for an organization that makes them feel seen, valued, and celebrated on the days that are important to them.

At the same time, the benefits that an inclusive holiday policy can offer extend across every corner of a company, from recruiting talent to strengthening a DEI strategy. Here’s what small- and medium-sized business (SMB) employers need to know about crafting a holiday policy that accommodates a multicultural workforce and bolsters company success.

Paid time off that makes an impact

Corporate holidays are more than just paid days off. Giving employees a day off – without them having to miss out on pay or use a paid time off (PTO) day – can benefit SMBs in several ways. Here’s how:

  • Reinforces corporate values: Many businesses include elements of family, connection, and humanity in their core values, and enacting an inclusive holiday policy reinforces that the company stands behind those values and prioritizes the personal lives of all employees. These workers are more likely to be engaged and connected with the organization’s mission.

  • Contributes to DEI programs: When it comes to DEI initiatives, it’s critical that businesses practice what they preach and avoid performative activism, or activism that is done to increase a company’s social capital rather than because of its devotion to a cause. One way to do this is by developing a more equitable holiday schedule that makes all employees feel appreciated.

  • Aids in recruiting and retention: Unfortunately, burnout is on the rise, and to protect their mental health employees are prioritizing flexibility. In fact, nearly 70% of workers say they’d rather have better work-life balance than higher pay. An inclusive holiday policy can help SMB leaders attract diverse talent, stay competitive in the tight labor market, and retain employees by making them feel recognized and giving them the work-life balance they desire.

3 important questions to ask

It can feel intimidating when you begin planning your inclusive holiday policy. But the process doesn’t need to be confusing. Here are three questions SMB leaders should ask as they adapt their policies to better fit their diverse workforces.

1. What matters to your workers?

There’s one important question you need to answer before you begin editing your holiday calendar: what do your employees want?

Among your workforce you probably have a mix of cultural, generational, and religious differences – and thus, employees will likely have a mix of expectations and preferences when it comes to paid holidays. It’s important to adopt an employee-driven calendar and take the time to properly assess what your staff desires.

Listening to your employees’ feedback shows that you value them, and there are several tactics you can use to gather data on which holidays your workers want off. Examples include:

  • Use your HRIS technology to track holidays not currently recognized by the company that many employees take off using PTO days.
  • Send a survey to employees about their holiday preferences.
  • Host a town hall meeting where leadership encourages employees to speak up about the holidays they value the most. This time can also be used to direct staff’s attention toward the survey mentioned above.
  • Encourage managers to have face-to-face meetings about holiday preferences either with their teams or with each individual team member.

2. Is there opportunity for the policy to reflect your core values?

A holiday schedule is a great place for SMBs to incorporate their core values and honor what’s important to them.

For startups or small businesses, a company calendar can be a fresh slate that can align with the culture SMB leaders are working so hard to build. Potentially more agile than a large enterprise, these smaller organizations may have the opportunity to craft a calendar that is based on their specific values, not just the standard list of federal holidays.

For established or larger businesses, updating a holiday schedule is a great way to align paid days off with DEI efforts. While this may be a long-term and effort-filled task, it can be very worthwhile in terms of employee satisfaction, attraction, and retention.

Wondering what a value-centric holiday looks like? Some examples include a veteran-friendly employer making Veterans Day a paid holiday, or a company that values civic engagement giving each election day off.

3. What’s the best way for us to celebrate?

You’ve used data to determine which holidays your employees value the most, and you’ve identified any potential paid days off that align with your organization’s core values. The next step is outlining how exactly your company plans on celebrating these special days.

As you consider ways your organization could commemorate certain holidays, it’s important to strike a balance between which days are important to your employees and what you can feasibly offer as a business. Can your company afford to provide an additional paid day off? Are there any customer expectations you need to consider, such as customer support availability? What about any payroll concerns, or state and federal compliance issues? Consulting with the HR experts at a professional employer organization (PEO) can shed light on these issues as you build an inclusive holiday policy.

Here are three main ways businesses can honor a holiday, no matter their time, budget, and service constraints:

Close the office

On one end of the spectrum, an organization may choose to close its office to celebrate a holiday. This decision is not a simple one, however, and SMB leaders should ask themselves the following questions before writing an office closure into policy:

  • When do your clients take off?
  • How does the general public honor this holiday?
  • Will all departments be able to take off? What about your help center or IT employees?
  • Can you offer this new paid holiday without cutting back on current PTO allotments?
Provide a floating holiday

Floating holidays provide a compromise between closing the entire office and operating “business as usual.” These days function like a hybrid between a company-wide paid holiday and a PTO day, and allow employees to take off whenever they have something important to celebrate without shutting down the organization.

SMB leaders should decide on the specifics of their floating holiday policy, but the Society for Human Resource Management (SHRM) highlights some guidelines in their sample policy that can serve as a good starting point, including:

  • A certain number of floating holidays are designated to each employee per year, in addition to the company’s regular paid holidays
  • Floating holidays may only be used for religious or cultural holidays, employee birthdays, or other state or federal holidays during which the organization remains open
  • The request for the floating holiday must be scheduled and approved in advance by the employee’s manager
  • Floating holidays cannot be carried over to the following year, cashed out, or paid upon termination of employment
Celebrate on the clock

If you can’t afford to close your business for a certain holiday, don’t worry. You can still find special ways to honor the day for the employees who are working. Here are some examples of ways to celebrate together at work:

  • Offer holiday pay
  • Designate the day to be deadline-free
  • Provide catered meals to in-office staff
  • Decorate the office accordingly or host a virtual costume or decorating contest
  • Allow remote work to as many staff as possible
  • Close the business early
  • Encourage celebrating employees to use your corporate wellness room for prayer, etc.

Honing your holiday policy

Holidays don’t have to stress you out. By partnering with a PEO, you can receive dedicated unbiased guidance on a variety of HR topics, including building an inclusive holiday policy.

But that’s not all – a PEO, like ExtensisHR, can also equip you with tools that take make the process even easier. For example, ExtensisHR’s intuitive DEI Dashboard provides actionable demographic data to help you design your holiday policy, and its Work Anywhere® platform enables users to run custom reports to analyze PTO trends, keep track of their PTO days, and more.

Ready to design an inclusive holiday policy of your own? You’re not alone. Contact the experts at ExtensisHR today to get started.

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