Why Mandating Time Off is Good for Business

Would you believe us if we told you that one of the best ways you can build a team of productive, engaged, and successful individuals is by creating a workplace culture that embraces the importance of annual leave?

Sounds counter-intuitive, right?

However, numerous studies and real-world examples illustrate that mandating time off is not just beneficial for employees but also advantageous for the business as a whole. 

In this blog post, we’ll explore how ensuring your team is taking their time off is a strategic move that can lead to a more engaged, healthier, and ultimately more productive workforce.

The Science Behind Why Time Off is So Good for Us

Numerous studies have shown that taking regular breaks, including extended time off, can significantly improve mental and physical health.

It is well known by many that stress, especially prolonged stress, is able to significantly weaken our immune system, as illustrated in this article by Simply Psychology. It can also inhibit our digestion, put strain on our circulatory system, and encourage the production of cholesterol. 

Taking annual leave can reduce stress by removing people from the activities and environments that they associate with stress and anxiety. This break allows employees to recharge, leading to lower stress levels, improved mood, and better overall health.

In fact, a study by America’s International Foundation of Employee Benefit Plans found that employees who take their annual leave time are 40% more productive and generally less irritable, fatigued, and depressed, with significant boosts to their memory.

It seems that by taking time out to recuperate, employees are not only able to improve their physical health but also feel mentally rejuvenated and ready to take on challenges they may not have been before their time off.

Enhancing Employee Engagement and Retention

When employers treat taking time off as a positive thing and encourage their staff to use their holiday time, it demonstrates to employees that their employer respects their work-life balance and personal time. This, in turn, improves the employer-employee relationship and encourages employees to stick around for the long term.

This is incredibly important; managers and leaders of many businesses have been grappling with rising employee turnover rates in the past few years. In fact, a survey conducted by Nectar in March 2024 found that 46% of the employees they spoke with were looking to find new work in the next 6 months!

One of the most surefire ways to combat this problem is to create a workplace that employees love to be a part of. A large part of that is ensuring that your team has the opportunity to take annual leave, allowing them that time to decompress and eventually come back recharged and ready to take on new projects and challenges!

How to Implement Mandated Time Off

Create a Clear Policy

Start by developing a clear and comprehensive time-off policy. 

Outline the amount of time off employees are entitled to, how it can be used, and any blackout periods. This way, everyone will be on the same page about how paid time off works in your company and will be able to plan breaks and holidays smoothly.

You should also make sure the policy is easily accessible and communicated regularly to all employees.

Lead by Example

Leadership should model the behaviour they want to see in their teams. 

When executives and managers take time off and respect others’ time off, it sets a positive example and encourages employees to do the same without fear of negative repercussions.

Promote a Culture of Balance

Encourage a culture that values work-life balance. 

All too often, we see companies with a pretty solid PTO package that hardly any of the employees actually end up using, either because the workplace culture treats taking time off negatively or because these employees are afraid of falling behind in their work. 

In order to combat this, you should regularly remind employees of the importance of taking breaks and vacations. 

It may also be a great idea to celebrate and share stories of how taking time off has positively impacted team members. If one of your employees has come back from their break with a fresh perspective on how to handle a tough challenge you have at the moment, treat it as the success it is!

Provide the Tools and Resources

Ensure that employees have the tools and resources they need to manage their work effectively, even in their absence.

. This might include cross-training team members, creating detailed handover documents, or using project management tools to keep track of tasks and deadlines. This should ease the minds of employees who feel reluctant to take time off due to their workload. 


Ensuring that your team uses their annual leave is a win-win for both employees and businesses. It fosters a healthier, more engaged, and more productive workforce, which ultimately contributes to the overall success of the business.

By prioritising employee wellbeing through encouraging employees to take time off, businesses can create a positive work environment that attracts and retains top talent, drives innovation, and enhances performance.

As employers, managers, and leaders, it’s time to recognise the immense value of time off and make it an integral part of our organisational culture. Investing in employee wellbeing is not just good for business—it’s essential for sustainable growth and success.

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