If you operate a small business, you know how critical great employees are to your success. Great employees are hard to find; keeping them can be even more difficult, especially if you have a limited budget. One of the easiest and cheapest ways to attract, retain and reward great employees is to offer extended vacation time.

In a Debate.org poll, 88 percent of respondents said giving workers more vacation time increases the quality of their work. Vacation time has historically been awarded according to years of service, but a new standard of thinking dictates that vacation time should be liberally applied from Day One. The thought process is that payroll is a static monthly expense, so it doesn’t cost more to offer more vacation time. Employees love more vacation, of course, and can come back from vacations focused and ready to produce.


So how much time off do you give your employees? Ultimately, that depends on your business model and ability to cover responsibilities during employee absences. Many traditional companies offer two weeks of vacation to begin with, but you could offer a month – or even two. Red Frog Events’ Joe Reynolds even goes so far as to offer his employees unlimited vacation time. Red Frog employees are expected to perform at a high level, and rewarded for doing so by being able to take off work according to their needs. According to Reynolds, the system isn’t abused; on the contrary, his employees work harder and achieve more.

If you want to offer employees extended vacation time and still maintain productivity, start by determining your company’s goals for the next year. Understand what projects or human resources will be needed to achieve those goals, and determine who will be responsible for them. When you set clear expectations and measurable goals for your employees, performance evaluation is easy. And that makes offering extended vacation time easy.

Here’s a fictional example. Let’s say you hire Joe and it costs the company $100,000 a year to employ him. During the next 12 moths, Joe is responsible for meeting four major company goals. To your company, the attainment of those goals is well worth your $100,000 investment in Joe. As long as Joe is able to achieve said goals, why should you care when he comes and goes – or for how long he is on vacation? Ultimately, you end up with the same investment and return, whether you meticulously track Joe’s hours or offer unlimited vacation.

The fact is that the best employees aren’t only interested in pure salary, and vacation time is one of the easiest and cheapest benefits you can offer. It’s also one of the most desirable. When you offer extended vacation as a benefit, great candidates will line up at your door. You’ll end up with great employees who care about achieving company goals, and you’ll end up with greater production and better product quality. That translates into happier customers, which is why extended vacation is more than an investment in your employees – it’s an investment in your own livelihood.

Read more: Keeping Your Business Going While on Vacation