Performance review based on leave days

Question

Edit: I believe my question has been misunderstood. I have probably not formulated it correctly. My company gives 6 weeks of vacation and we work 4 days a week (30 hours). The question was not related to exceptional cases, nor to take the vacation.

I work in a software consultancy where we bill hours to our clients. If we work on a project, we can bill the hours and make money. If someone is on vacation, sick, or having an HR talk, the company, of course, assumes the costs.

We have a strong focus on career development. We want to grow people and pay them fairly. We have created a career ladder that removes bias and gives a direction to our employees on what to focus on. The career ladder includes impact, communication, technical skills, teamwork, and so on. We are software consultants, and because the industry is very competitive, our employees expect a yearly salary raise.

Recently, there has been a debate on including "attendance" in the career ladder. It is a sensitive topic, and I feel it is a taboo. We do not want to promote someone who has had many leave days because the contribution to the company has not been sufficient even though they might have grown their skills.

Of course, people have their "right to be sick," and I believe the cause of being this a sensitive topic is that people feel that their "right" is being challenged. To be clear, we do not want to fire anyone. That is where I believe the right is protected. We do, however, have some cases where people have been off for a long time, causing an important cost to the company.

Is it common to take into account attendance on a career ladder? Is any company open about this?

Of course, you are welcome to comment if you consider this immoral. After much thought, I believe it makes sense, as we pay people depending on their contribution to the company.

Answer 1

Measuring a person's value by the amount of leave days they take is beyond idiotic. If people are taking unauthorized absences, that's a different thing entirely.

Using leave days as part of a performance review like this is dumb because:

A) it has no bearing on what value an employee brings to the company. Your star programmer may have put in how-many hours of crunch time making the software that is the bedrock of one of your products. That programmer will take liberal amounts of leave after each crunch because they need it. Conversely, a corrupt employee who could be actively costing you money may not take any leave at all for fear of someone finding out their embezzlement of funds. Who's the better employee?

B) it penalises people for having a life outside of work. Are you really going to punish employees for having the audacity to get married? Have babies? Attend funerals?

C) it will create a highly toxic atmosphere that will destroy the productivity of your top performers. Take the programmer example earlier. What's gonna happen if he is under pressure not to take leave? He won't take the leave. And he'll burn out. And his performance will nosedive.

TL;DR: if you want to evaluate someone for promotion, the first metric should always be what value they bring to the company. Leave days aren't an indication of value in the slightest.

Answer 2

You don't indicate your location, but denying someone a promotion because they took "too many" days off is probably illegal. Unless you're willing to risk a lawsuit or another legal complaint, please don't do this.

There are a few reasons most people take time off: either because they were given vacation time, because they were sick, or because they had medical or maternity leave.

If they took time off because they were given vacation time, why would you give someone vacation time and then punish them for taking it? This is sure to cause resentment and morale problems, and it would have the perverse effect of punishing people who worked there a long time (since people usually get more vacation time as they're with the company longer).

Denying someone a promotion based on having taken medical or maternity leave would effectively be retaliating for them having taken the leave, which is illegal in many jurisdictions. Also, denying someone a promotion for taking maternity leave would be gender discrimination, and denying someone a promotion for taking medical leave would likely be discriminating against them for having a disability.

Also, to respond to a few of the specific statements:

We do not want to promote someone who has had many leave days because the contribution to the company has not been sufficient even though they might have grown their skills.

If their contribution to the company hasn't been sufficient to justify a promotion, why do you need to explicitly consider attendance? Just make promotions based on contribution.

To be clear, we do not want to fire anyone. That is where I believe the right is protected.

No, it doesn't protect the right. Even if you're not firing them outright, denying them some benefit, promotion, etc. that they would have otherwise been eligible for based on their gender or disability status is still discrimination.

We do, however, have some cases where people have been off for a long time, causing an important cost to the company.

Is the main issue here the cost to the company incurred by their lengthy leave, or their suitability for a promotion? Failing to promote them to "make up" for costing the company a lot of money could be perceived as vindictive, especially given that there's a good chance that it was due to something beyond their control. For example, if someone was off for a few weeks due to a death in the family, do you really think that they wanted that to happen either? They're probably more upset by the death of the family member than the company is by the added expense. Why add insult to injury by denying them a promotion for costing the company money?

Answer 3

Is it common to take into account attendance on a career ladder?

No. Many software companies give unlimited time off or 30 days off as a minimum. Typically official HR rules about time off aren't applied to productive tech team members. The manager isn't even tracking sick days because it doesn't matter. All that matters is delivering/solving problems.

We do not want to promote someone who has had many leave days because the contribution to the company has not been sufficient even though they might have grown their skills.

That sounds like measuring the wrong thing to me because a worker A. could bring in a lot of high paying clients which pay more per hour than worker B. Worker A. taking some time off isn't really costing the company as much as worker B. because worker A. already paid for his time off. Plus we know that repeat business is important. Worker A. has created an investment that will return similar amounts in the future even if he/she leaves the company. And if you say that these workers don't do sales, well they still are part of your PR/marketing in that the quality of their work matters and they're a huge part of why you get repeat business.

Performance matters. If worker A consistently does a great job it'd be unfair to penalizing them for the week off they took for a family vacation while the worker who consistently does the bare minimum gets rewarded for spending an extra week being average?

Or imagine this scenario -- which happens all the time -- the worker has a death in the family in another part of the country. That's like 3 days to 1 week time off. That could happen twice in a year. Even if that scenario only happens once in 20+ years it can still happen any random year.

Or pregnancy leave.

Are you seriously going to punish someone for having a "life changing event".

I'd have little interest in working for a place that is trying to be a sweatshop and doesn't even want me to go on vacation to say nothing of dealing with emergencies. It might fly for someone fresh out of university but experienced people will raise their eyebrows.

Maybe you should be estimating the total lifetime value of each customer brought in (or given excellent service) and consider that.

Try using carrots instead of sticks. I've worked places that gave huge bonuses for volunteers to work on important side projects & rush jobs. You could easily add 10% to your annual salary with a single job. Believe me, I didn't mind working half a day on a project like that WHILE on my vacation at a resort.

Answer 4

This sounds to me like it's bordering uncomfortably close to contract violation, where in the contract you "give" some number of vacation days, but actually using them is so frowned upon that it's an unwritten rule that you can't use them. It probably doesn't rise to that level legally, but it's uncomfortably close.

Question: In your locale, do you have to pay for unused vacation days? If you do, you could be costing your company more money than you save. Let's say you have a steady stream of work, not too much but not too little, enough that everyone is working but nobody is overloaded. To make the math easy, let's say your employee has 20 vacation days and works 365 days per year (nobody actually does, but the number doesn't actually matter so let's say they do for an example). If your employee takes 20 vacation days, you have to pay them for 365 days, and they only worked 340. However, the projects you had still got done and you made $X from your contracts. On the other hand, let's say the employee worked all 365 days and took no vacation. Then you pay out their vacation days; you're paying them for 385 days (+20 days), but you still only made $X from your contracts. You've lost 20 days salary worth of money, per employee!

The only way this scheme actually makes sense is if, either you have too much work to complete and not enough people, in which case you should hire more people rather than stressing out the people you already have, or your locale does not require you to pay out vacation days, in which case you're functionally robbing your employee of a contractual obligation, which might be illegal.

At the very very least, if I was your employee, what would be going through my head would be: "My employer is penalizing me for using my contractually required benefits; I'm going to find another employer who actually honours the contract". All your good staff will quit and find another job, leaving you with only people who are too unskilled to work elsewhere, or too stupid to realize what you're doing. Do you want to be known as the consulting company who only employs unskilled and stupid people? Any client who knows anything about technology at all will be able to sniff this out within 1 week of working with you on their project, and your reputation will start to grow...