Principle: When a nominal raise is below last year’s inflation, real pay declines. Granting equivalent paid time off restores the total compensation value without changing base payroll. Time is money: the missing purchasing power is compensated with rest days.
Budget reality: We understand there can be budget constraints that prevent fully matching inflation for everyone. That’s why we propose additional days off as an alternative lever to keep compensation equitable.
Productivity effect: People typically gain experience and get faster and better at their jobs each year. Modest extra rest can preserve performance and reduce burnout, so the team’s output doesn’t suffer while real pay stays fair.
How the math works
real_gap = 1 − (1 + raise) / (1 + inflation)
days_needed = working_days × max(real_gap, 0)
If raise ≥ inflation ⇒ gap ≤ 0 ⇒ 0 extra days needed.
Assumptions about working days
Defaults approximate a 5-day week minus statutory/typical leave & nationwide holidays. They vary by sector/region/tenure, so please edit to match your contract or company policy.
- Argentina: ~235 working days (standard 5-day week minus holidays and leave). source
- Australia: ~230-232 working days (20 days annual leave + public holidays). source
- Brazil: ~226 working days (30 calendar days leave ≈ 22 working days + holidays). source
- Canada: ~240-253 working days (varies by province, typically 2-3 weeks vacation). source
- Chile: ~229-238 working days (15 working days annual leave + holidays). source
- Colombia: ~227-238 working days (15 working days leave + holidays). source
- France: ~218-224 working days (25 working days leave + 11 public holidays). source
- Germany: ~230-245 working days (minimum 20 working days leave + holidays). source
- Italy: ~220-228 working days (varies by sector, typically 20+ days leave). source
- Japan: ~226-234 working days (10+ days leave by tenure + 16 public holidays). source
- Mexico: ~238 working days (12+ days leave by tenure + holidays). source
- Peru: ~226 working days (30 calendar days leave + holidays). source
- Spain: ~224-225 working days (22 working days leave + 14 public holidays). source
- UK: ~232-253 working days (28 days statutory leave including bank holidays). source
- US: ~239-260 working days (11 federal holidays + ~10 vacation days typical). source, source
Data sources (2024 inflation):
- Argentina — INDEC (reported): 2024: 117.8%. source
- Australia — ABS: Dec-quarter 2024 y/y 2.4%. source
- Brazil — IBGE (IPCA): cumulative 4.83% in 2024. source
- Canada — Statistics Canada: Annual review 2024 (annual avg 2.4%); The Daily Dec-2024 (y/y 1.8%). source, source
- Chile — INE: 2024 closed at 4.5% (Dec release). source
- Colombia — DANE (reported): 2024 closed at 5.2%. source
- Euro area (HICP) — Eurostat: Dec-2024 y/y 2.4%. source
- France — INSEE: in 2024, inflation was 2.0%. source
- Germany — Destatis: annual average 2.2% in 2024. source
- Italy — ISTAT: annual average +1.0%; Dec-2024 y/y +0.6%. source
- Japan — Statistics Bureau: annual average 2.7% in 2024. source
- Mexico — INEGI: Dec-2024 y/y 4.21%. source
- Peru — INEI (reported): 2024 closed at 1.97%. source
- Spain — European Commission (HICP): annual average 2.9% in 2024. source
- UK — ONS: CPI rose 2.5% in the 12 months to Dec 2024. source
- United States — BLS: Annual & semiannual indexes (annual avg 2.9%) and Economics Daily (Dec/Dec 2.9%). source, source