Contrary to popular belief, the grass is not always greener. One of the perks of sticking with a job for a while is long-service leave (LSL).

But are UK companies using this to their best advantage?

What is long-service leave?

LSL is extra paid leave, on top of annual leave, that you become entitled to after a set period of time with the same employer.  In the UK, there is no legal entitlement to long service leave. It’s at the company’s discretion, and some prefer to offer ‘long service awards’ instead, eg a cash bonus or gift.

How do you get it, and when?

There is no official definition of what counts as ‘long service’, but typically it’s around 10 to 15 years. But with the trend towards shorter periods with one employer, some businesses are lowering thresholds.

For example, the University of Oxford has a tapered system, where staff get 1 extra day of leave per year after 5 years’ service, 2 extra days after 7 years, and 5 days after 20 years. Some companies go even further, offering accrued LSL after just 2 years at the company.

Taking Long Service Leave

Some people might use long-service leave to bring their retirement date forward or reassure themselves that retirement is definitely what they want. Others may take it as soon as possible, perhaps for a big trip. This is better for the employer, as wages tend to increase over time, so the cost of leave increases too.

Is Long Service Leave a good thing?

Some argue that LSL is ageist and discriminates against newer staff. Or that it isn’t fair and creates separation and resentment at work. But this is about your ‘company age’, not your actual age. LSL is accessible to everyone – all they have to do is stay. It’s based on quantity not quality. In theory, it’s not so different from how annual leave is accrued.

We don’t see how rewarding staff loyalty can be a bad thing. And loyal staff are more and more hard to come by, especially post-Covid and ‘the Great Resignation’. Offering extra paid leave in recognition of long-term effort and commitment is a great way to show that you value and appreciate your staff.

The benefits of long-term employment

The biggest barrier to LSL is its perceived relevance in the modern work landscape, where it’s common to switch roles and/or employers every few years. This is especially true for younger generations.

But for many people, work is just a means to earn a living. Job-hopping and climbing the ladder just isn’t high on their agenda. They want to show up, do a good job, get paid and get on with their life. These are the kinds of people to whom LSL will appeal. They are also fab employees: they are loyal and committed; they will show up and work hard; they see a future with you so they will contribute meaningfully to long-term goals. These are the people you want by your side for the long-haul of building a sustainable and successful business

Long-term employment still offers huge benefits. Building a career through constant job hopping is a bit like a game of snakes and ladders. Sideways moves may not always pay off. You could land yourself in a horrible culture, with a nightmare boss, or miss out on the chance to build knowledge and experience.

Novelty doesn’t have to be found elsewhere. If, alongside LSL, you can keep staff engaged and interested in their work, for example with a great professional development plan that shows a commitment to long-term wellbeing and growth, you can stop eyes from wandering.

Key takeaways

While by no means a fix-all solution to high turnover, long-service leave can serve as a tantalising reward that might entice more stability-minded employees to stick with you for the long haul.

By keeping one eye on the now, building a great culture and prioritising professional development, LSL might get employees looking further into the future – and seeing you in it.

Author – Phil Norton

Phil is the co-founder of Leave Dates, the employee annual leave planner. He loves problem-solving and making life easier for small businesses. If you book a Leave Dates demo, he will give you a warm welcome and show you everything that you need to know.