A vacation buy-back plan is a program that allows an employee to sell his or her unused vacation time back to the employer. This is a common practice in many organizations, and it allows employees to profit from unused vacation days. It also benefits the company since the employee will be able to provide more of his or her services, which will increase revenue and production in the long-run. As time progresses, employees have the opportunity to accumulate a large number of vacation days, and for many employees, it is simply impossible to utilize all of these days. Vacation buy-back plans solves this problem by facilitating a mutually beneficial exchange between workers and employers. During wage and salary administration procedures, this time exchange will be factored into paychecks.
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