Source: TeamLewis
One fifth of employees have accrued more than the yearly entitlement, meaning businesses may be risking millions of dollars in leave liability
More highlights from ELMO’s Q3 Employee Sentiment Index:
- 58% of employees are working from home to save money, but one third say a free lunch could entice them back to the office
- Transport costs (44%) and saving money on food spending (24%) are the biggest financial drivers for working from home
- Almost half (48%) have avoided taking leave to save money or because of the cost of living, while 24% say they have too much work to take leave
- The amount of employees who believe they are remunerated fairly for their work has reached the lowest level in the past two years in New Zealand.
- In contrast, a peak of 70% of employees feel their contributions are now seen at work
- The number of Kiwi workers encouraged by the economy to seek a pay increase and to search for a new job have reached a peak this quarter.
Monday, 17 October 2022: The majority of workers in New Zealand feel they’re prevented from taking annual leave due to the cost-of-living pressures and demanding workloads, according to the latest industry research from ELMO Software https://elmosoftware.co.nz/
The ELMO Employee Sentiment Index for Q3 2022 found 80% of Kiwi workers who accrue annual leave have a reason preventing them from taking a break. Almost half (48%) say that saving money due to the rising cost of living is the main reason preventing them from taking leave, one quarter (24%) say it’s because they have too much work and one fifth (19%) are concerned about traveling because of COVID-19. https://elmosoftware.co.nz/resources/research-reports/
By the end of September 2022, one in five (20%) workers in New Zealand will have accrued more than the yearly entitlement of four weeks leave with the average employee saving 22.5 days annual leave. Ten percent will have accrued more than two months of annual leave.
The study revealed that men are more likely to have over a month of saved annual leave compared to women (24% vs 16%), with an average three extra days (23.9 vs 20.9 days). And employees are also accumulating sick leave (also known as sick and carer’s leave). Ten percent have more than the yearly entitlement for personal leave, with the average number of days saved just under 15 (14.8 days).
Danny Lessem, Co-Founder and CEO of ELMO Software says these findings should be a strong reminder for business leaders to prioritise leave management within their organisation.
“Allowing annual leave accrual to blow out not only impacts an organisation’s bottom line, but it is a significant liability on the books, potentially costing New Zealand businesses millions of dollars. What’s more, taking leave is crucial for employees’ wellbeing. The damaging impact of burnout, with its flow on effects to productivity and performance, would be unnerving to quantify.
“The ELMO ESI Q3 emphasises the need for business leaders to understand why employees are not taking their leave. Is it due to unrealistic workloads, lack of resourcing, job insecurity, or because of the rising cost of living and economic uncertainty in New Zealand? Whatever the reason, it needs to be rapidly addressed by business leaders,” said Lessem.
“And as the end of year and holiday season approaches, this issue is particularly relevant for both employers and employees. Mandating employees to take a significant portion of their annual leave, encouraging them to enjoy a well-earned break and look after their mental health and wellbeing is paramount.”
Lessem says business leaders who focus on effectively managing employee leave entitlements over the next few months will come out ahead as we move into the New Year.
“For many organisations, this means utilising intuitive and innovative HR technology solutions as part of their people management strategy. Tech helps both leaders and HR to centralise, automate and simplify leave management processes. This gives senior management the ability to plan and forecast leave entitlements and provides peace of mind.”
Cost of living and working from home vs office/site
As well as influencing employees’ decision to take leave, the cost-of-living is impacting where they choose to work. The majority of employees in New Zealand (58%) are choosing to work from home to save money. Of those, 44% choose to work from home to save on transport costs and a quarter (24%) say it’s because they spend more on food when they work at the office/on site.
And according to the data, one-third (32%) of people working from home in New Zealand say a free breakfast or catered lunch would entice them back to the office. Twenty-eight percent would be encouraged to work from the office if they received a stipend/subsidy or if the office has better technology than they have at home; 25% will return for wellness initiatives and 24% for career development sessions.
Employee priorities
In other findings, remuneration and bonus payments/incentives remains unrivaled as the top priority for employees, which is indicative of the growing fear around a global recession or looming job losses. Flexible and remote working has overtaken stability of an organisation in the list of employee priorities, highlighting the state of the current working environment.
Adding to this picture is the number of Kiwi workers encouraged by the economy to seek a pay increase and to search for a new job have reached a peak this quarter, at a time when perceived economic security is improving.
Over half (52%) are seeking a pay increase (up from 45% in Q2 2022 and a 22 percentage point increase from this time last year (30%). These numbers are driven predominantly by the younger generations with Gen Z at 74% and Millennials at 60%. And 39% of workers in New Zealand are now searching for a new job (versus 30% in Q3 2021).
In addition, more employees considered a career change in the last three months than ever before, with an increase of seven percentage points to 30% since Q2. This is aligned with the amount of employees in New Zealand who believe they are remunerated fairly for their work, decreasing further to 53%. This is the lowest level in the last two years, decreasing 10 percentage points since the end of last year (Q4 2021 63%) and is in contrast to the finding that a peak of 70% of employees feel their contributions are now seen at work. It seems recognition and remuneration are not going hand in hand in this current market.
Worker wellbeing
Q3 found almost one in three (29%) New Zealand workers continue arriving at work feeling unwell – 10 percentage points above the same time last year (19%). These numbers are higher for younger generations, specifically Gen Z at 49%, with Millennials at 36%.
Burnout levels remain relatively stable at 36%, with a third (32%) of employees continuing to feel overwhelmed with the amount of work they have to do. The number of people who have taken a legitimate sick day in Q3 2022 remains high at 41%, 9 percentage points higher than in Q3 2021, reinforcing that COVID-19, flu and colds have been rampant over the winter without a lockdown in place.
“It’s been a challenging year for everyone, and as we move into planning for 2023, people management processes and solutions should be reviewed with a lens that considers workloads, resourcing and project deliverables, yet prioritises simplification, efficiency and employee wellbeing.”
About the ELMO Employee Sentiment Index
The ELMO Employee Sentiment Index offers an insight into the actions, attitudes, concerns, and behaviours of New Zealand’s workers. The report provides a quarterly analysis of the prevailing sentiment within the workforce to track changes in perceived job security and the employment landscape.
Respondents were asked to reflect on the three-month period between July 2022 to September 2022. The research was commissioned by ELMO Software and conducted by Lonergan Research in accordance with the ISO20252 standard. Lonergan Research surveyed 515 New Zealand workers aged 18 years and over between 15 July 2022 and 24 September 2022. The Research was conducted via a 14-question online survey. Respondents were members of a permission-based panel, geographically dispersed throughout New Zealand including capital city and non-capital city areas. After surveying, data was weighted to the latest population estimates sourced from Stats NZ.
About ELMO Software
Established in 2002, ELMO is a cloud-based HR, payroll, expense management and rostering / time & attendance software provider. The company offers customers across New Zealand, Australia and the UK a unified platform to help organisations streamline their people, process and pay. ELMO operates on a software-as-a-service (“SaaS”) business model based on recurrent subscription revenues. For more information, please visit www.elmosoftware.co.nz
