Morph of a Nerd CEO – Sick Days are Sick

Here you are with your own company.  You don’t get to write code any more (or you shouldn’t be writing code, anyway).  There’s a lot of petty stuff you have to deal with.  One of the worst is adjudicating sick days, personal days, niche holidays, compassionate leave etc. etc. There are always some people who abuse whatever scheme you set up.  There are always impossible requests like “I have to take a sick day because my son is sick and can’t go to school.”  There’s also the problem of having a policy more lenient than the policy of the employer of the spouse of one of your workers:  guess who stays home to wait for the cable guy?

We found a way around all this at ITXC and it seemed to work pretty well.  May not be legal in all states, though, so check before implementing.

We looked at all the things people got time off for: vacation was a function of years on the job; sick days, personal days, and compassionate leave a function of need; holidays the same for everybody; jury duty and reserve activation determined by external factors.  Then we decided to lump everything except jury, reserve duty, and legal holidays together.

The numbers before we made the change were something like this: ten days of vacation for every one with less than five years service (which was everyone), five days of sick leave and two personal days annually, complicated rules on how much compassionate leave you got for whom, three days which were not legal holidays when the office was shut (the network never closes).

We gave everyone twenty days annually which were theirs to do what they wanted with without any demeaning explanations or transparent lies.  No more separate sick leave, personal days, or compassionate leave.  Closed only on the seven legal holidays.  Want to take off the day after Thanksgiving? Use one of your days.  Want to celebrate the anniversary of the release of DOS?  Use one of your days.  What you don’t want to do is use up all of your days and then get sick because you won’t get paid until longterm disability (optional) kicks in.  This makes every employee the judge of his or her own needs.

Actual scheduling of time off (except when sick or in an emergency) required supervisor approval to assure that the company had adequate coverage at all times.  But the time belongs to the employee. 50% of unused time could be carried forward (that’s how you build a bank for a sabbatical).  Carried forward days could be cashed in at termination (watch the accounting on this) or, at the companies option, could be sold back at the end of each year (depended whether we were short of labor or cash).

People received this well at first.  I sold it as treating them as adults (which it was).  Most remained happy with it.  A few had a problem when they used all their days and then needed some more but I wasn’t sympathetic and didn’t grant exceptions because exceptions would make the whole plan fall part.

For people who were with us more than five years (eventually that happened), we added five days.

We continued to pay people who were called for jury duty or whose guard units were activated (minus whatever they were paid by the court or the armed forces).  Felt this was something people had no control over and that we should spread the monetary part of this civic burden.  Not sure what we would have done if we’d been very small or had many people called up for active duty; but we could afford this so we did it.

Other posts in this series:

First Sole Practitioner

The First Employees

The Power of Silence

Yuk, Selling

The Close

When Free is the Right Strategy

The Three Rules of Free

When Free is the Right Strategy (Cont)

Comments

[Dylan Salisbury]

Here's a better policy if you are the CEO: Don't track sick time at all.

I've worked in two companies where this was the policy. One place was a government contractor. The policy was widely abused. Everyone knew who the worst abusers were and resented it.

The second company is an outfit that has extremely high standards in trying to only hire the best people for each position. The sick policy works out great. Everyone appreciates the fact that sick people aren't pressured to come into the office and spread viruses. Employees with children feel that their needs are respected. People generally check their e-mail and try to work from home if all they have is a cold.

The difference is the quality of the employees and the company culture. If you are the CEO you can have a lot of influence over those things, and they will pay off far beyond the ability to implement a fair sick time policy.

[Ron]

I did this for my IT consulting company that we started in 1990. Worked well then and it should work well today if the employees are smart enough not to waste the time and to always keep some in the bank for when real sickness strikes.

[Karl]

It's always seemed to me that systems like that encourage contagious sick people to come in and infect their coworkers.

"It makes no sense whatsoever to penalize the healthy and reward the deceptive."

This presumes that penalizing the sick makes sense. What about someone who gets sick a lot because of a handicap?

(Note that having children, which I am given to understand is something else you can't discriminate against, counts as a handicap for the purposes of that question...)

[Karl]

It's always seemed to me that systems like that encourage contagious sick people to come in and infect their coworkers.

"It makes no sense whatsoever to penalize the healthy and reward the deceptive."

This presumes that penalizing the sick makes sense. What about someone who gets sick a lot because of a handicap?

(Note that having children, which I am given to understand is something else you can't discriminate against, counts as a handicap for the purposes of that question...)

[candice]

I used to work for a teeny little business where all days off were out of an accrued pool. It got really really annoying to have to ask for regular holidays. I like your system better.

Now, however, I have no employer, just clients, so the vacation strategy is to always have extra cushion money around. (Though I hate losing money from getting sick, it comes with the territory.)

I suppose related to this post is "How to make time off for yourself without feeling guilty about it."

[Timothy Post]

Agrre with everything except the monetization of "Away Days" (as I call them) by letting folks roll 50% of unused time over into the next year and then cash them out when they leave. I believe in a "use them or lose them" policy. I don't like confusing compensation with Away Days. Plus, carrying the liability on the balance sheet is something I don't like. BTW- I gave folks 30 days with the full expectation that only a couple people would actually use the full 30 days. So far, only one person has used all 30 day and it ws because her father was sick and died in Portugal. K.I.S.S. to the rescue again.

[Chris Yeh]

Tom,

This is exactly how we handle it at my company. It makes no sense whatsoever to penalize the healthy and reward the deceptive. People are adults, and do appreciate it.

This scheme is also better than the "no vacation policy" I had at my first employer, since the inability to accrue PTO led many of us to undervalue it, and I'll bet we took less vacation than under a normal policy.

Then again, maybe that's a sign that the policy was effective!

[Tom Evslin]

Eric:

Good question, particularly today in Vermont when we are still stuck 24 hours after the big storm.

We used our "external force" rule. If the State of NJ asked businesses to close, then we did and the day off was "free". If not and somebody lived a long way away or had a bad driveway, that went under the individual choice rule and was one of his or her days.

[Eric]

How did you handle "snow days" - those days where you're nice enough to send people home, or half your employees can't get out of their driveways?