Sabbaticals and Employee Motivation: Benefits, Concerns, and Implications ANDREW E. CARR THOMAS LI-PING TANG Middle Tennessee State University Murfreesboro, Tennessee “S abbatical” is a word that finds its derivation in “Sabbath,” literally meaning a recurring period of rest and renewal. Webster’s New World Dictionary gives the following definitions for the “sabbatical year”: (a) among the ancient Jews, every 7th year, in which, according to Mosaic law, the land and vineyards were to remain fallow and debtors were to be released; and (b) a year or half year of absence for study, rest, or travel, given at intervals of originally every 7 years, to teachers in some colleges and universities. Sabbaticals can be traced back to the need for an incentive that would attract potential faculty members to Harvard University in the late 1800s. In the most traditional forms of sabbatical, the university grants a faculty member whom it has employed for 7 years (a) 1 academic year off while granting him or her half pay or (b) 1 academic semester off while granting him or her full pay. The term sabbatical (extended leave or personal retreat) has a myriad of connotations in today’s workplace. It may mean a break of any time period from 1 month to a couple of years. Companies seeking ways to motivate their employees through the use of sabbaticals should look at the various reasons or needs for their use as well as forms of sabbaticals. Although much evidence highlights the positive impact Journal of Education for Business ABSTRACT. The use of sabbaticals as a means to improve employee motivation and morale is growing rapidly as companies seek ways to retain their star performers and fight the effects of job burnout. In this article, the authors examine the various forms of sabbaticals in diverse industries, the reasons for their use, and the relevant benefits and concerns for organizations and employees. The authors’ review of current literature suggests that the adoption of sabbaticals can have positive effects on both business organizations and employees. They conclude with implementation strategies for making sabbaticals work effectively and suggestions for possible future research on the issue. that sabbaticals can have on employee motivation and morale, both employers and employees must consider the relevant benefits and concerns (risks and expenses) carefully. In this article, we examine all of these issues, focusing first on the need for sabbaticals. The Need for Sabbaticals University Why do university professors need a period of rest and renewal? Professors are notoriously risk-averse people. After receiving tenure, many rarely change jobs. They need to leave their ivory tower and experience the real world of work in business and industry. Professors in gen- eral and those in colleges of business in particular also are pressured to show accountability regarding their intellectual contributions by publishing more journal articles or writing for top-ranked business journals. These achievements signal that they are satisfying the mission statements of the colleges of business and the Association to Advance Collegiate Schools of Business (AACSB–International) requirements that they be academically or professionally qualified to teach (Trank & Rynes, 2003). As of August 2003, 452 institutions hold AACSB business accreditation. One hundred sixty-three of these institutions have additional specialized accreditation for their accounting programs, and 46 universities with AACSB business accreditation are outside of the United States (e.g., Australia, Brazil, Canada, Chile, Costa Rica, France, Germany, Hong Kong, Ireland, Israel, Japan, Mexico, Netherlands, Saudi Arabia, Singapore, Spain, South Korea, United Kingdom, United Arab Emirates, etc.). Obtaining AACSB–International accreditation is important for business schools not only in the United States but also all over the world. Because of accelerated knowledge creation in recent years, the half life of college education is about 3.5 years— that is, 50% of knowledge learned in college becomes obsolete in about 3.5 160 years. Students need to return to school and take new courses. Professors need to do the same to stay current and remain competent in classrooms as well as in their research productivity. These activities, which enhance knowledge creation and dissemination, are becoming a necessity rather than simply an incentive or luxury for professors. Business and Industry With increasing uncertainty and sluggish economic growth forecasted for the near future, many companies are searching for ways to trim costs and increase profits while simultaneously fighting a battle to keep employees’ attitudes positive. Sabbaticals may be the key. In fact, 15% of 450 large employers who responded to William M. Mercer, Inc.’s 2000 Survey of Work/Life Initiatives offered paid sabbaticals (Bradford, 2001). Following the same trend, nearly half of the companies listed in Fortune’s 100 Best Companies to Work for in America provided sabbaticals or similar leave programs in the year 2000—up 18% from 1999 (Bounds, 2000). Employees reported returning from such leave with a deeper commitment to their jobs and a feeling of more purpose than before. Do the benefits outweigh the costs? Some researchers suggest that, in fact, benefits do outweigh the costs, but only when sabbaticals are implemented properly and with a good understanding between employee and employer regarding all expectations involved. About 75% of office employees feel that work has infiltrated their private lives. With more and more professions requiring 60-plus-hour workweeks, it is no wonder that there is a growing epidemic of work-related stress. Work-related stress may cause absenteeism, illness, turnover, high costs (medical, insurance, and replacement), low morale, and many other destructive consequences. According to CCH Unscheduled Absence Survey (CCH Inc., 2004), the following reasons were given for unscheduled absences in 2003: personal illness (36%), family issues (22%), personal needs (18%), stress (11%), and entitlement mentality (13%). According to that analysis, work-related stress and life (personal) stress may be related to three categories of reasons for unscheduled absences: personal illness, personal needs, and stress. Between 1995 and 2003, the rate of absenteeism (paid unscheduled hours absent/paid productive hours) varied between 1.9% to 2.9%, with the highest peak in 1998 and the lowest in 2003. At the same time, the cost of absenteeism per employee has increased from its lowest amount, $572.00, in 1997, to its highest, $789.00, in 2002. The rate of absenteeism was the lowest in 2003; this low rate may have been caused by the slow economy and the large number of job losses and layoffs. During the 12 months following September 11, 33% of companies reported layoffs in their organizations. An estimated 1.466 million jobs were lost in 2002, the second largest annual total in history. After downsizing, significantly fewer employees have to shoulder more responsibilities and perform the same amount of work. When companies have several rounds of layoffs, employees are more likely to show up to work and are more eager to show a high level of performance to keep their jobs than previously. They may wind up “feeling pressured to continually do more and more in order to be seen as going beyond the call of duty” (Bolino & Turnley, 2003, p. 70). The escalation of organizational citizenship behavior (OCB) creates stress. Having experienced corporate cuts, burnout, and the lingering effects of September 11, a broad range of Americans are finding the idea of taking a break appealing. Another factor is the tremendous influx of women into the workforce in the past 2 decades. More than 45% of all employees are women, and 70% of married women with children under the age of 18 work outside the home. A working mother often finds herself in a tight balancing act of handling the responsibilities of her family and career, and any unexpected problem can wreak havoc on her situation. A growing number of employees are already tired and depleted. Many people, affected by an ongoing fear and anxiety in the wake of September 11, feel the urge to spend more time with the family, which may inspire more women to stay home with their children in spite of economic concerns. Sabbaticals are receiving more attention now, as the booming economy of the late 1990s has given way to the recession of the new decade. Much like in the recession of the early 1990s, employers again are struggling to provide interesting and meaningful work for employees who will not be receiving promotions. They also hope to combat the consequences of an increasingly stressful environment: absenteeism and stress-related compensation claims. In summary, the pressure for employees in the global competitive work market is increasing. They simply have to work harder, faster, and with higher quality to survive. But people do need to take some time off from work regardless of their profession and whether the leave is scheduled or not. Sabbaticals in Various Industries One of our MBA students, for example, is on his 2-year sabbatical from India. This MBA student, a professional who has worked in the financial industry for more than 15 years in India, is obviously eligible for the sabbatical and has more than the required criteria in services to his organization. During this 2-year period, he will receive two thirds of his highest base pay in India without the benefits. He needs to file reports to his boss regarding his course work and progress in completing his MBA in the United States. Upon returning to his regular job in India, he is required to offer 5 more years of service to the institution. From the organization’s point of view, this company will have a more qualified and highly-trained (U.S.trained) employee who will continue his loyal, committed, and productive services to the organization for another 5 years. It is very possible that the benefits may outweigh the costs (two thirds of the employee’s pay for 2 years) for that 2-year sabbatical. Such practices may generate high morale among employees, satisfied customers in the community, and greater revenue for the organizations. The field of accounting is not traditionally known for flexible work pracJanuary/February 2005 161 tices such as sabbaticals. However, some large firms have found that sabbaticals give them an edge in recruiting and retaining top talent (“Is It Time to Consider Sabbaticals . . .,” 2003). Although they are still rare in the world of CPA firms, sabbaticals are an accepted practice in law firms. They are proving to be a beneficial way to improve lawyer retention and motivate lawyers without causing a drain on the firm’s profits. Perkins Coie, one of three firms on Fortune magazine’s recent listing of 100 Best Companies to Work for in America, was rated high for having a strong sabbatical program as well as flexible work schedules. The technology sector is warming to the idea of sabbaticals. Cisco Systems and Accenture Ltd., a global information technology (IT) consulting firm, has implemented 1-year sabbatical programs for many employees to reduce the scope of recent cutbacks. The employees retain one half to one third of their salaries plus benefits, and the company is able to keep tabs on workers it may want to rehire once the economy rebounds (“Working Alternatives to Job Cuts . . .,” 2002). Sabbaticals also may be appropriate for certain health care executives who seek to benefit from the learning curves of other industries such as banking, information systems, marketing, and consulting. Employees seeking to take a sabbatical often must meet certain requirements. Most companies require 5 to 10 years of service for eligibility to take a sabbatical. Some firms allow an employee to qualify in as little as 3 years if he or she has earned good performance evaluations. Another consideration is whether the company will place restrictions on how the sabbatical is spent or simply allow employees to decide how best to fill their time. Benefits for Companies The most common positive effect of sabbaticals is the ability that they provide to organizations to reduce costs and preserve their investment in their employees so that the human capital is in place when the economy resumes its growth. Sabbaticals are also a method of “keeping faith” between a company and 162 Journal of Education for Business an employee whose skills are not in immediate demand but might be at a later date. Companies can retain good employees’ goodwill, which is often lost through the humiliating downsizing process. Sabbaticals offer an answer to the problem of employee burnout (Maslach, 2003). Companies with employee burnout may experience low productivity, depressed morale, and high turnover of valuable employees who possess specialized knowledge and skills. High rates of employee burnout also can increase the likelihood of workplace violence. Recruitment of the best employees has become increasingly important in every field. Sabbaticals are proving to be a strong incentive for many top performers looking for workplace flexibility. For these top performers, sabbaticals can create a sense of company loyalty and commitment. Diana Chan, a human resources manager with Ernst and Young LLP, returned with a renewed commitment to her firm. Discussing her sabbatical experience, she remarked, “I felt that [by supporting my leave] they had reinvested in me” (Stenner, 2003). With the growing concern over corporate ethics that followed such highprofile cases as Enron and WorldCom, sabbaticals are providing a way for companies to exercise their checks-andbalances systems. An organization’s ethical problems sometimes become apparent when matters previously handled by one employee are handed over to another. As one employee leaves and another takes on additional responsibilities, unethical practices that previously were hidden sometimes come to light. Concerns for Companies Taking into account salary, health benefits, and replacement labor costs, an organization can ratchet up extensive costs to support an employee on a paid sabbatical. Paying employees not to work can be expensive, particularly for large companies that have a number of workers eligible for sabbaticals. When managers of Boston Consulting Group, Inc.’s German unit met in October 2000 to plan for the year ahead, they found that 13% of their consultants were currently on sabbatical leave. Although only 3% of German companies currently have sabbatical programs, that number is rising, prompting problems such as the aforementioned example (Richter, 2000). Companies also face the risk that their employees will not return after their sabbaticals end. The company faces a shortterm cost when its employee takes personal leave, but the cost can become long term if that person chooses not to return to the company. To discourage this outcome, many firms have strict retention policies that help recoup expenses. Employees may have to reimburse their former employer the full amount of salary and benefits received if they depart immediately, with the reimbursement obligation declining on a sliding scale as time passes into the 2nd and 3rd year after the sabbatical. Experts point out that although these concerns are legitimate, they are mostly unfounded because workers rarely fail to return to their positions after taking sabbaticals. Some have noted that even if a person chooses not to return after a sabbatical, the company may still benefit. Lori Gordon, a partner with Chicago’s Latham & Watkins, stated that lawyers who decided to leave following a sabbatical were not good for the firm in the first place. She asserted, “The law firm is better off not having lawyers whose hearts aren’t in their work and who might be unproductive and disenchanted” (“Is It Time to Consider . . .,” 2003, p. 2). Benefits for Employees Many employees who return from sabbaticals report that they feel refreshed and rejuvenated and have a newfound passion for and commitment to their work. A properly planned and used sabbatical can renew and re-energize employees, making them more productive than before. Sixty-nine percent of respondents offering sabbaticals stated that the opportunity to “refresh and recharge” was one reason for allowing such leave (Bradford, 2001). Microsoft has reported that employees who return from its sabbatical program often cite boosted creativity and increased knowledge (Dyer, 2002). In general, employees who are creative, innovative, or entrepreneurial may develop new ideas while averting jobrelated stress and burnout. Some divisions of Lockheed Martin Corp. offer a sabbatical under the Entrepreneurial Leave of Absence Program. Under the program, employees eager to start new businesses can use 2 years of unpaid leave to do so, paying company rates for health insurance. After that, they can choose to leave permanently or return to the company. Even when employees choose to leave, the company can emerge a winner. Lockheed Martin’s venture-capital group, Innovative Ventures Corp., is willing to invest about $250,000 in the startups in return for some 10% equity (Hise, 1997). Some companies use community service programs along with sabbaticals to help employees foster a stronger sense of corporate pride and of “giving back” to the community. Pamela Holley, whose 15-year-old daughter was being treated for sickle-cell anemia at Children’s Hospital Medical Center–Oakland, took a 6month sabbatical from Wells Fargo to help the hospital’s sickle-cell unit set up a database system. Although the computer and project management experience helped her advance when she returned to work, her most positive experiences were the personal contact that she had with the doctors and learning more about her daughter’s affliction. Although some employees report doing nothing but lying in the sun and reading good books during their sabbaticals, others choose to use the time to travel, write a novel, volunteer with nonprofit organizations, or learn a new skill such as playing the piano or building a house. The key, experts agree, is to find ways for sabbatical takers to continue useful habits or projects begun during their break. Anne Hawley Stevens, a Boston Career coach, offered the following recommendation: “Even if you learned a new language or started a fitness program, find some way to incorporate them into your work life so that you don’t lose the patina of the sabbatical” (Dunham, 2002). Employees who do this should be able to hold on to the positive effects of the sabbatical even after they return to a hectic work environment. Employees often report that one of the greatest benefits of sabbaticals is the opportunity that they provide for learning something about oneself during the break. Most people do not go on sabbaticals for the rest that they offer—they take them because they have lost their original excitement and enthusiasm for their work. The sabbatical can be a time for workers to consider what engages them. Then they can “turn that knowledge around” and apply it to their jobs. Concerns for Employees The obvious concern for an employee taking an unpaid (or reduced-pay) sabbatical is the need to have enough saved income for daily living. In addition, studies show that reducing contracted hours directly affects an employee’s pension accrual and contributions to insurance-related benefits such as income protection and critical illness coverage (“Work-Life Balance . . .,” 2003). A career break lasting 5 years could result in a 20% reduction in an employee’s pension fund if he or she retires at age 60. The employee would need to increase his or her monthly contributions by nearly 50% upon returning to work to compensate for the shortfall. Employees taking sabbaticals also may face difficult personal questions. Although corporate America may outwardly support the notion of a balanced life, in truth, many executives’ self-worth and identity are wrapped up in their jobs. The initial drop in responsibilities and lack of immediate feedback or recognition may leave some managers questioning their own value. While an employee is on sabbatical, most companies choose not to hire a replacement and instead ask other employees to take on the additional workload. Potential adverse feelings from coworkers not on sabbatical must be considered (Thomas, 2002). Some companies, such as Tandem Computers, Inc., see a potentially positive flipside to this problem. Their use of cross-training solves the scheduling problem and provides a greater depth to the company’s key positions. One of the principle objections to sabbaticals in the IT world is that in such a fast-changing environment, any time off jeopardizes the employee’s cutting-edge skills (Dyer, 2002). Employees must address this concern adequately or risk allowing their skills to become obsolete during their time away from work. Many lawyers thinking about taking a sabbatical report that they worry about losing their clients to their replacements or that their clients will not receive adequate attention and high-quality service while they are gone. These feelings, if left unresolved before the start of the employees’ sabbaticals, may prevent employees from relaxing and using their time effectively. Implementation Strategies for Companies First, when offering a sabbatical period, a company should decide on an appropriate duration that will allow the employee sufficient time off to accomplish his or her goals and renew his or her energy while not jeopardizing the company’s long-term profit objectives. Second, administrators should discuss and agree on a set compensation package that (a) makes clear in detail what the company will provide to the employee in terms of salary, benefits, and so forth and (b) spells out penalties for an employee’s resignation from the organization after his or her return. Third, the company should make arrangements for a smooth transition for the returning employee to “get up to speed” as quickly as possible and provide ways for the employee to implement new learning gained on the sabbatical in his or her work. Implementation Strategies for Employees First, the employee should make adequate arrangements with the company, such as meeting all requirements and deadlines for notice, training a replacement, and leaving emergency contact information. Second, he or she should prepare financially to have enough money for basic living arrangements and for any potential plans. Third, the employee should develop a clear set of goals regarding what he or she wants to accomplish during the break. Finally, he or she should plan an exit and re-entry strategy with respect to the marketplace. As companies struggle to maintain positive employee morale and motivaJanuary/February 2005 163 tion while not compromising employee productivity and effectiveness, many corporations across a broad spectrum of industries are using the age-old practice of sabbaticals to accomplish this goal. Although some controversy exists over the appropriateness of sabbaticals to all professions, the majority of research suggests that, when implemented correctly, they can provide a valuable way for employees to reduce stress, avoid burnout, and return to work refreshed and revitalized with a stronger commitment to their work and the company as a whole. Future Research Future research on sabbaticals may focus on the following questions: How does the use of sabbaticals empirically improve employee behavior, performance, and effectiveness in an organization? What are the complimentary and detrimental effects of sabbatical use on coworkers, clients, and the effectiveness and efficiency of the organization as a whole? Although few workers who have taken sabbaticals would have anything but glowing praise for them, more detailed and objective studies are needed for full support of the current claims and for dispelling any myths about their fail- ures. More specifically, business researchers and practitioners need to study the literature on “360-degree feedback” and evaluation research; develop comprehensive survey instruments and objective measures regarding the use of sabbaticals; establish reliability, validity, and measurement invariance regarding the measurement instruments; develop a comprehensive theoretical model (e.g., involving what, how, why, who, where, and when); and test the model empirically in the literature. We need more rigorous research to document fully the effectiveness and efficiency of the sabbatical programs and the return on investment (ROI) for employees and organizations. ACKNOWLEDGMENT We would like to thank Diane Miller and Bill Connelly for their assistance and support. Both authors contributed equally to this article, and their names are arranged alphabetically. Please address all correspondence to Thomas Li-Ping Tang, Box 516, Department of Management, Jennings A. Jones College of Business, Middle Tennessee State University, Murfreesboro, TN 37132, USA. Telephone: (615) 898-2005, Fax: (615) 8985308, e-mail:
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