PTO Benefits Analysis in a Merger
When two companies have merged, there is more to the deal than just the financial ramifications. Creating a workplace from now two sets of employees is a difficult task. Each company has their own set of policies, procedures, and benefit packages. Implementing a plan to transition the benefits and policies and communicating the details of the plans is imperative to the merger. Although these plans are costly to companies, benefit plans are employee friendly. Companies try to offer the best plans, which are very competitive in attracting and retaining a talented workforce (Society for Human Resource Management, 2008) The more ...view middle of the document...
While most states consider vacation time as a “carry forward entitlement”, sick days are often “use it or lose it”. (Scheuermann & Luecke, 2008) This is often called presenteeism, in which employees come to work sick in order to save PTO time for vacation. To avoid this, the company needs a culture that encourages employees to stay home if they are unwell.
Can both vacation benefit systems be used after the merger?
Utilizing both systems could add to the problems of the merger, instead of alleviating issues. The goal should be to reduce labor costs while maximizing productivity. Maintaining two systems is costly and tedious for human resources/bookkeeping. Also, keeping both systems can result in less buy-in and perpetuate the “us versus them” mentality. (Cascio, 2012) The employees can feel discriminated and create a divided workforce. This can lead to reduced productivity and possible legal issues. Employees may see this as unfair and create negative merger publicity. There isn’t equality between the systems: accruals are different, when to utilize the days, and the pay rates associated with accrual levels are different for possible the same jobs. (Scheuermann & Luecke, 2008)
The company should implement a PTO system for the company to offer. This system is easier to manage and attractive to new employees. (Society for Human Resource Management, 2008) Offering PTO empowers employee to use the time of at his discretion allowing for more flexibility, which is in sharp contrast to employer dictated sick/vacation time benefits. In order to implement the system the company must provide clear guidelines prior to implementation of the plan. For example, before using PTO the employee must give notice, unless there are unforeseen circumstances as being sick or an emergency. If too many employees are off at the same time, such as extended summer vacations and holidays, the organization will have customer service, staffing, productivity and operating continuity issues. (Cascio, 2012). Unplanned absenteeism is costly to an employer so trying to coordinate a schedule is a desirable option. The company must also define an emergency so as not to give preferential treatment. Secondly, it should be clearly...