Planning for, and managing staff leave

Sometimes hiring temporary staff is your only fall-back when you need more hands on deck, but Bracken and Allan suggest business owners look at offering a lower level staff member a development opportunity to step into the role, and temping their lower level role, at a smaller expense to the business.

The business owner will also need to consider the direct costs of hiring additional staff in the short term, and any leave loadings staff are entitled to under awards or individual workplace agreements.

Allan warns that annual leave payments are also an expense on a business owner’s balance sheet. "So if you’ve got people who are owed more and more leave, you’re actually building up this significant liability and it’s a wise move to keep control of that."

Bracken says that by accumulating leave, businesses will also take a loss if staff have been promoted or their salaries have increased due to performance reviews, because in most cases the business needs to pay for annual leave at a staff member’s current rate of pay, even though some of that leave would have been accumulated while they were being paid a lower rate.

But one of the forgotten costs is from a health point of view, she adds, because if staff don’t take any leave, eventually they’re going to get stressed, tired and run-down, and productivity will suffer.

Five Tips to Manage Leave

• Have a formal system for leave taking. This will help all employees feel that they are being treated equally.

• Have an agreed staffing plan in place to manage absences.

• If the business is cyclical, plan not to have staff take leave during peak periods.

• Have a procedures manual where leave taking policies are written down and communicated to all staff.

• Make sure that you, the owner, take leave to recharge the batteries.