The boss of Virgin Group, Sir Richard Branson, is offering his personal staff as much holiday as they want. He has removed the limits on the amount of holiday Virgin employees can take each year, in the hope it will boost morale, creativity and productivity (and generate some positive PR of course!).

The ‘no holiday policy’ policy permits staff to take off whenever they want, for as long as they want. There is no need to ask for prior approval, and neither the employees themselves, nor their managers, are asked or expected to keep track of their days away from the office.

Whilst the Sir Richard believes that stripping away the company’s holiday policy, and allowing staff to take breaks when and as often as they wish, will have long term benefits for his business, not every business can take their holiday policy to such an extreme: after all you have to make sure that you have employees in place at key times to enable your business to deliver on it’s promises.

However, there is a solution for businesses that allows employees to take more holiday, and managers to manage their team effectively, and deliver high quality customer service: an annual leave salary sacrifice scheme.

Popular Benefits

Over the last few years living standards have suffered, with either pay freezes or below inflation pay rises. However, whilst employees may be trying to find savings from numerous pots, one area that surveys have shown they are not willing to compromise on its taking regular holidays.

An annual leave salary sacrifice scheme allows employees to buy more holiday,which means that if they want to take extended leave for a reason, then they can do so. Giving your employees the chance to spend more time with their family, to travel, to get married, to do volunteer work, or simply just to redecorate. It’s a great way to boost morale and, as a result, improve productivity at work.

Benefits for employers

Setting up an annual leave purchase scheme makes good sense for employers. Recent studies suggest that an increase in annual leave allowance can reduce absenteeism and boost morale. And in addition, allowing employees to buy or sell parts of their annual leave can positively influence productivity, save the business money and improve their reputation as a good employer.

Despite the squeeze on salaries, many more employees buy holiday rather than sell their annual leave entitlement. This means that organisations can make major savings on salarieswhilst delivering an extremely popular employee benefit.

One organisation with a holidayplus scheme from p&mm has saved over £500,000 in wage costs in just one year!

Setting up scheme

It’s easy to set up an annual leave scheme, and is a popular choice with employers, who value the benefits it can bring to both their employees and their business.

Schemes can be tailored to suit your needs, and they can accommodate various work patterns, such as part-time employees. Once the scheme is set up your employees will be able to sacrifice part of their salary, in return for extra annual leave. This in turn reduces your salary billsaves you the National Insurance Contributions from their salary, and gives the employee extra annual leave holiday with reduced net pay impact.


It is also worth mentioning that, employers do need to make sure that their employees are actually taking their holiday entitlement, however many days they have. Not only is there a legal minimum number of days an employee has to take, but not taking enough holidays can lead to employee burn out and greater stress levels, which increase ill health absence and can negatively affect both the team and the organisation.