Thread: I don't understand the sacrifices by my bosses. Accounting help needed.

The idea of saving the money is a tad... odd. It works like this. Lets shoot out some hypothetical numbers.

Every year the company assumes each employee will accrue 200 hours of vacation/sick time combined. Whenever you choose to take that time is up to you but the monies has already been allotted for each employee for each year.

Some companies adopt the policy of "Use it or lose it". This helps the company so they don't have to save the monies for each employee who hasn't used any/remaining vacation/sick time. Essentially, if you don't use it, you lose it thus the company gets to keep the monies allotted that each employee has failed to use. You are kind of paying the company. Much like what Pixelfixed mentioned, most companies prefer you to use it to help reset your mind and relax.

Now, since the company has allotted those 200 hours of vacation/sick time for each employee from 1 Jan 2012 to 31 Dec 2012 the books already reflect the monies required for each employee. What they are asking you to do is USE IT. This sets the books to $0 for vacation/sick time and they no longer will have a lump sum off cash sitting in a bank that cannot be used. Remember, they said if you don't use it, you lose it and the company keeps what you don't use. Also, since the comapny has aboloished the vacation/sick time for each employee for the fiscal year of 1 Jan 2013 to Dec 31 2013 they will be saving 200 hours for every-single employee. That saving according to your CEO equates out to $3.5m accross the board.

When a company aboloishes vacation/sick time I usually begin to worry and update my resume. When they stop the free coffee I hop on the life boat and bail before the Titanic sinks.

Hope this makes sense to you and was helpful.

::EDIT::
One thing I forgot to mention is that now each employee will most likely have to take NO PAY for each time they take vacation/sick time. Thus, the company saves money when they leave however, that small idea can backfire when work is not being accomplished and things fall behind and go undone.